ANNUAL REPORT. Bratislava Stock Exchange

Transcription

1 BURZA CENNÝCH PAPIEROV V BRATISLAVE ANNUAL REPORT Bratislava Stock Exchange

2 CONTENTS 1. INTRODUCTION BASIC INFORMATION SECURITIES ON STOCK EXCHANGE MARKETS TRADING CLEARING AND SETTLEMENT OF TRANSACTIONS MEMBERSHIP INSPECTION EXTERNAL RELATIONS AND MARKETING ECONOMIC RESULTS FOR THE YEAR STATEMENT OF THE SUPERVISORY BOARD

3 INTRODUCTION Marián Šedo Chairman of BSSE Executive Board Mária Hurajová BSSE Director General 2 Dear Shareholders, From a perspective of achieved volume of trading, the year 2005 was very successful for Bratislava Stock Exchange (BSSE). A positive development of trading in comparison with the year 2004 was reflected in the total trading volume that nearly equalled the record level from the year 2003, in which the volume of transactions exceeded 1 billion Sk. As of 31 December 2005, the total volume of transactions on BSSE amounted to billion Sk, thus representing a percent increase against the same period of the previous year. This volume was achieved in transactions, which represents a 38.7-percent decrease against the year The noticeable increase in the volume of transactions in the year 2005, as compared to the year 2004, can be traditionally attributed to debt securities as well as to an increased demand among foreign investors, who secured their Slovak-koruna positions primarily by investing in government bonds. In addition, the market was joined by the pension fund management companies around mid-year, and they also invested the minimum 30% - which the law requires to be invested in domestic securities - mostly in government bonds. The Slovak share index SAX experienced a considerably volatile development in the year 2005, alternating long-term periods of appreciation and decline. SAX performed the best at the start of the year when it managed to utilise the exponential growth that had begun back in The indicator of the share market recorded an all-time high on 14 March, with its value peaking at points. In the next period until the end of November, its development was characterised by significant volatility stemming from small investors increased interest to capitalise on historical highs of the base issues when selling shares in these companies. In several phases of the index s appreciation and decline, the aforementioned activity brought the year-end value of the SAX index to points. In general we can say that, given its closing value, the Slovak share index appreciated in the period from 23 December 2004 by 26.5%, which is an increase by 86.7 points in absolute terms. In the previous year we ended the computation and publishing of the bond index SDX. Its publishing ended on 1 October 2005; the final values of this index are computed as of the last trading day of the year 2005, i.e. as of 23 December Its function on the market has been fully replaced by a group of bond indices the SDXGroup which is now the official indicator of the bond market, published by BSSE since 1 September An important event of the year 2005 was the adoption of an amendment to the Act No 566/2001 (Coll.) on Securities and Investment Services, which came into effect on 1 August The amendment has implemented the Directive No 2003/71/ES on Prospectus, which is published in the event of a public offer of securities or in the event of admission of securities to trading. Based on a single Prospectus approved by one supervisory body, the issuers can now offer securities in all countries of the European Union. Amendments were subsequently made to the Stock Exchange Rules and to the BSSE Fee Order; the amendments came into effect on 1 November Other positives for the capital market included the adjustment of a fee paid to the Financial Market Authority (or, respectively, to the National Bank of Slovakia from 1 January 2006 onwards) for approval of a Security Prospectus (changed from the original Sk, depending on the volume of issue, to the uniform fee of Sk), simplification of the administrative procedures for approval of Prospectuses and, last but not least, shortening of the period for approval of a Prospectus from 60 days to 10 days. The year 2005 was definitely positive from a perspective of its perception by governmental institutions. The capital market in Slovakia has been lagging behind the other segments of the financial market and is left unnoticed by companies seeking to

4 acquire additional resources. For this reason, the situation on the capital market became the subject of strategic documents of the Slovak government, with the aim of achieving an increase in its performance. One of said documents is the Analysis surveying all major obstacles that hinder the capital market s development and effective access of companies to the capital market, elaborated by the Ministry of Finance of the Slovak Republic. The document defines the steps that need to be taken in order to improve the current situation. In addition to changes in the legislation pertaining to the capital market, the document deems it necessary to support the Slovak capital market and use it for finalising privatisation of 10-percent interests of selected companies in state ownership. Another precondition for the capital market s development is the completion of changes in its infrastructure, which are to be achieved through an ownership interconnection between the Stock Exchange and the Central Securities Depository of the Slovak Republic. The realisation of certain tasks aimed at achieving the defined goals began as soon as in the year They are to be finished, together with other tasks of the aforementioned document, in the course of the year In the year 2005, the Stock Exchange actively participated in the activities of the Federation of European Securities Exchanges (FESE). The main task of FESE is to ensure communication with institutions of the European Commission (including lobbing) during elaboration and adoption of EU legislation. FESE systematically provides its members with information on the processes of preparation and adoption of individual regulations, finalises the Federation members observations and ensures that they are accepted by the relevant bodies of the European Commission. In 2005 great attention was paid, among other things, to making observations to the draft measures resulting from the European Commission s directives, primarily from the Market in Financial Instruments Directive (MiFID), as well as from various consulting documents of a strategic character aimed at the European Commission s long-term objectives in the area of financial services leading to an overall increase of competitiveness of the European capital market. Notwithstanding the fact that certain expectations, with which the Stock Exchange entered the year 2005, were not met (e.g. arrival of new issues to the Stock Exchange market and delayed incorporation of the Central Securities Depository into BSSE), the Stock Exchange ended the financial year with an after-tax profit of 3.55 million Sk. It is an increase by 1.76 million Sk in comparison with the profit of 1.79 million Sk, projected in the year 2005 s budget. The main factor behind the achieved profit was an increased volume of trading fees, which amounted to million Sk and represented 57.25% of the Stock Exchange s revenues from own products and services in the year Let us finally express our gratitude to all involved entities and individuals, who make every effort to build, stabilise and reactivate the Slovak capital market, for their continuing active co-operation and support in the year We believe that the year 2006 will bring positive changes in every respect not only to the Stock Exchange, but also to the capital market as a whole. 3 Marián Šedo Chairman of BSSE Executive Board Mária Hurajová BSSE Director General

5 BASIC INFORMATION BSSE SHAREHOLDER STRUCTURE AS OF 31 December 2005 Bratislava Stock Exchange (j.s.c.) was founded on 15 March 1991 in compliance with a Decree of the Ministry of Finance of the Slovak Republic, issued in the year The Stock Exchange is a legal entity entered in the Commercial Register of County Court Bratislava I. At present the Stock Exchange performs its activity on the basis of a licence to operate as an organiser of the public market of securities, issued by the Financial Market Authority on 25 June BSSE s registered capital amounts to million Sk. As of 31 December 2005, the Stock Exchange had 19 shareholders. As of the end of the year 2005, the Stock Exchange had 33 employees. No. Name of shareholder Share in registered capital (Sk) Number of shares Share in registered capital (%) 1 Fond národného majetku SR ,13% 2 Všeobecná úverová banka, a.s ,20% 3 Allianz - Slovenská poisťovňa, a.s ,31% 4 OTP Banka Slovensko, a.s ,31% 5 Slovenská sporiteľňa, a.s ,98% 6 Capital Partners, o.c.p., a.s.* ,64% 7 Oost-Europa Participaties, B.V ,64% 8 Poštová banka, a.s ,34% 9 KORUNA Invest, a.s ,76% 10 Devín banka a.s. (v konkurze) ,88% 11 ING Bank N.V. (Holandsko) prostredníctvom pobočky ING Bank N.V., pobočka zahraničnej banky ,88% 12 Slovenská kreditná banka, a.s. (v konkurze) ,88% 13 TatraCredittax s.r.o ,88% 14 Všeobecná investičná spoločnosť, a.s ,88% 15 Československá obchodní banka, a.s. (ČR) prostredníctvom pobočky Československá obchodní banka, a.s., pobočka zahraničnej banky v SR ,65% 16 KOOPERATIVA poisťovňa, a.s ,63% 17 UniBanka, a.s ,58% 18 Tatra banka, a.s ,26% 19 UNIQA poisťovňa, a.s ,17% TOTAL ,00% 4 BASIC INFORMATION

6 BSSE BODIES AND ORGANISATIONAL STRUCTURE Supervisory Board Anna Bubeníková Chairman of Supervisory Board General Meeting Executive Board Marián Šedo Chairman of Executive Board Director General Mária Hurajová Secretariat of Director General Stock Exchange Deals Inspection Department Júlia Ďurišová Department Head Legal Department Svetlana Kucmenová Department Head External Relations Division Barbora Lazárová Deputy Director General Division Director Economy Division František Novosad Deputy Director General Division Director Information Systems Division Karol Gers Division Director Stock Exchange Deals Division Oľga Dlugopolská Division Director Listing Department Róbert Vlkolinský Department Head International Relations and Marketing Department Monika Zabadalová Department Head Trading and Analyses Department Oľga Dlugopolská Department Head Clearing and Settlement Department Miroslava Balogová Department Head 5 BASIC INFORMATION

7 EXECUTIVE BOARD SUPERVISORY BOARD EXECUTIVE BOARD CHAIRMAN Marián Šedo, Istrobanka, Executive Board Member EXECUTIVE BOARD VICE-CHAIRMAN Peter Huňor, National Property Fund of the Slovak Republic, Vice-Chairman of Executive Board of the National Property Fund MEMBERS Ján Valko, Allianz Slovenská poisťovňa, Trading Section Director Róbert Kopál, Association of Securities Dealers, Director Ivan Gránsky, CA IB Financial Advisors, Executive Board Chairman Jozef Mihalik, National Property Fund of the Slovak Republic, Member of Executive Board of the National Property Fund and Director of Capital Market and Bonds Section Zita Zemková, OTP Banka Slovensko, Vice-President, until 10 June 2005 Rastislav Matejsko, OTP Banka Slovensko, Head of Business Policy and Controlling Department, from 10 June 2005 Róbert Herbec, Slovenská sporiteľňa, Head of New Issues and Corporate Finance Department Marián Matušovič, VÚB Asset Management, Executive Board Chairman CHAIRMAN Anna Bubeníková, National Property Fund of the Slovak Republic, Member of Executive Board of the National Property Fund and Director of Section of Founding Activities and Shareholder Rights Exercise MEMBERS Marek Jankovič, Allianz Slovenská poisťovňa, Executive Board Vice-Chairman and Vice-President for Economy Roman Klaban, Všeobecná úverová banka, Executive Board Member and Director of Financial and Capital Markets Section MEMBERSHIP COMMITTEE 6 CHAIRMAN Marián Šedo, Istrobanka MEMBERS Jozef Šnegoň, Československá obchodní banka, branch of foreign bank in Slovak Republic Jaroslav Hora, OTP Banka Slovensko Peter Šuba, Poštová banka Peter Kováč, Slovenská sporiteľňa, Until 26 April 2005 Adrián Málek, Slovenská sporiteľňa, From 28 April 2005 Stanislav Figlár, Všeobecná úverová banka Svetlana Kucmenová, Bratislava Stock Exchange Júlia Ďurišová, Bratislava Stock Exchange BASIC INFORMATION

8 SECURITIES LISTING COMMITTEE TRADING COMMITTEE 7 CHAIRMAN Ivan Gránsky, CA IB Financial Advisors MEMBERS Peter Polák, Československá obchodní banka, branch of foreign bank in Slovak Republic Boris Gubrianský, INVEST BROKERS, Until 31 December 2005 Róbert Blaho, ISTRO ASSET MANAGEMENT, Until 29 June 2005 Stanislav Štít, ISTRO ASSET MANAGEMENT, From 30 September 2005 Andrej Sinicyn, Komerční banka Rastislav Matejsko, OTP Banka Slovensko Ingrid Kodajová, Poštová banka Rudolf Lachkovič, Slovenská konsolidačná Ivana Čičátková, Slovenská sporiteľňa Dana Rudkovská, Tatra banka Richard Belyus, UniBanka Soňa Kundrátová, Všeobecná úverová banka Barbora Lazárová, Bratislava Stock Exchange Róbert Vlkolinský, Bratislava Stock Exchange CHAIRMAN Róbert Kopál, Association of Securities Dealers MEMBERS Miloš Labaj, Československá obchodní banka, branch of foreign bank in Slovak Republic Roman Hedera, Dexia banka Slovensko Ivan Hrušovský, HVB Bank Slovakia Martin Koska, ING Bank N.V., branch of foreign bank Mojmír Hojer, Istrobanka, Until 31 December 2005 Michal Holík, J & T SECURITIES (SLOVAKIA) Bohuslav Ukropec, Poštová banka Peter Lachkovič, Slovenská sporiteľňa Milan Čavojec, Tatra banka Tomáš Perďoch, UniBanka František Ravinger, V BROKERS Andrej Ungvarský, Všeobecná úverová banka Oľga Dlugopolská, Bratislava Stock Exchange Peter Šály, Bratislava Stock Exchange BASIC INFORMATION

9 SECURITIES ON STOCK EXCHANGE MARKETS SECURITIES LISTED AS OF 31 DECEMBER 2005 WITH CHANGES AS OF 23 JANUARY 2006 SHARES MAIN LISTED MARKET As of the end of the year 2005, BSSE registered on its markets a total of 381 issues of securities (shares, participation certificates and bonds), including 35 issues on the main listed market, 46 issues on the parallel listed market, zero issues on the new listed market and 300 issues on the free market. In the course of the year 2005, a total of 27 new issues of domestic securities (23.4 billion Sk) were admitted to BSSE markets, of which 5 issues represented an increase of registered capital (278.1 million Sk) in three companies. In addition to the newly admitted issues, the influx of new capital to the Stock Exchange markets also included admission of new tranches of already registered government bonds. In the course of the previous year, the issued volume of four government-bond issues was thus increased by a total nominal value of 59.8 billion Sk. The total financial value of capital newly admitted to the capital market in 2005 thus amounted to 83.2 billion Sk. Out of all newly admitted issues, 19 issues were admitted to the market of listed securities (1 government bond, 1 corporate bond, 2 bank bonds and 15 mortgage bonds) and 8 issues were admitted to the free market (including 5 share issues due to an increase of registered capital and 3 issues of corporate bonds). 1. Slovnaft a.s. Bratislava CS Slovnaft a.s. 2 nd issue SK Slovnaft a.s. 3 rd issue SK Všeobecná úverová banka a.s. Bratislava SK SLOVENSKÉ ENERGETICKÉ STROJÁRNE (SES) a.s. Tlmače SK SHARES MAIN PARALLEL MARKET 1. Biotika a.s. Slovenská Ľupča CS Biotika a.s. 2 nd issue SK Istrokapitál, a.s. SK OTP Banka Slovensko, a.s. SK NOVITECH a.s. SK Istrokapitál, a.s. 2 nd issue SK Istrokapitál, a.s. 3 rd issue SK OTP Banka Slovensko, a.s. 2 nd issue SK SECURITIES ON STOCK EXCHANGE MARKETS

10 BONDS MAIN LISTED MARKET Name of issue ISIN Date of listing 1. Government bond 133 SK Government bond 134 SK * Government bond 142 SK Government bond 143 SK Government bond 144 SK Government bond 151 SK Government bond 152 SK Government bond 161 SK Government bond 163 SK Government bond 166 SK Matador, a.s. 03 SK Matador, a.s. 04 SK Government bond 170 SK Tatra banka, a.s. 1 st issue of mortgage bonds SK Government bond 174 SK VÚB a.s. Bratislava 6 th issue of mortgage bonds SK Government bond 184 SK ISTROBANKA, a.s. 1 st issue of mortgage bonds SK Government bond 188 SK Government bond 189 SK Government bond 191 SK Government bond 192 SK VÚB a.s. Bratislava 7 th issue of mortgage bonds SK Government bond 199 SK Government bond 200 SK Government bond 201 SK Government bond 202 SK Government bond 203 SK Government bond 204 SK Government bond 205 SK * Following the redemption of bonds, their listing was cancelled and trading ended as of 23 January 2006 (Government bond 142). 9 SECURITIES ON STOCK EXCHANGE MARKETS

11 BONDS PARALLEL LISTED MARKET Name of issue ISIN Date of listing 1. Slovenská sporiteľňa, a.s. 1 st issue of mortgage bonds SK Tatra banka, a.s. 2 nd issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 2 nd issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 3 rd issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 4 th issue of mortgage bonds SK B.O.F., a.s. 5 th issue SK I.D.C. Holding, a.s. 4 th issue SK ISTROBANKA, a.s. 2 nd issue of mortgage bonds SK OTP Banka Slovensko, a.s. 1 st issue of mortgage bonds SK VÚB a.s. Bratislava 8 th issue of mortgage bonds SK VÚB a.s. Bratislava 9 th issue of mortgage bonds SK Unibanka, a.s. 1 st issue of mortgage bonds SK CAC Leasing Slovakia, a.s. 2 nd issue SK HVB Bank Slovakia a.s. 1 st issue of mortgage bonds SK VÚB a.s. Bratislava 12 th issue of mortgage bonds SK OTP Banka Slovensko, a.s. 2 nd issue of mortgage bonds SK Československá obchodní banka, a.s. 1 st issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 5 th issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 6 th issue of mortgage bonds SK B.O.F., a.s. 6 th issue SK ISTROBANKA, a.s. 3 rd issue of mortgage bonds SK OTP Banka Slovensko, a.s. 4 th issue of mortgage bonds SK ĽUDOVÁ BANKA, a.s. 1 st issue of mortgage bonds SK Československá obchodní banka, a.s. 2 nd issue of mortgage bonds SK OTP Banka Slovensko, a.s. 5 th issue of mortgage bonds SK VÚB a.s. Bratislava 10 th issue of mortgage bonds SK SECURITIES ON STOCK EXCHANGE MARKETS

12 BONDS PARALLEL LISTED MARKET Name of issue ISIN Date of listing 27. VÚB a.s. Bratislava 11 th issue of mortgage bonds SK VÚB a.s. Bratislava 13 th issue of mortgage bonds SK VÚB a.s. Bratislava 14 th issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 7 th issue of mortgage bonds SK OTP Banka Slovensko, a.s. 3 rd issue of mortgage bonds SK Unibanka, a.s. 2nd issue of mortgage bonds SK VÚB a.s. Bratislava 15 th issue of mortgage bonds SK I.D.C. Holding, a.s. 5 th issue SK Slovenská sporiteľňa, a.s. 8 th issue of mortgage bonds SK Slovenská sporiteľňa, a.s. 1 st issue SK OTP Banka Slovensko, a.s. 6 th issue of mortgage bonds SK VÚB a.s. Bratislava - 10 th issue SK On 19 July 2005, trading of a share issue of NAFTA (j.s.c.) ended on the main listed market of BSSE, following a decision of an ordinary general meeting of the company shareholders. In the course of the year 2005, BSSE ended trading of 86 share issues and 3 issues of participation certificates on the regulated free market (due to their transformation into open-end unit trusts). In 8 cases the share issues were cancelled in the Central Securities Depository of the Slovak Republic; 1 share issue was replaced with a new ISIN; trading of 1 share issue ended due to termination of the issuer by the court; trading of 2 share issues ended due to deletion of the issuer from the Business Register; trading of 1 share issue ended due to its parallel existence in both paper form and book-entry form; trading of 48 share issues ended based on the issuers requests; 25 share issues of 24 issuers were excluded from trading due to the issuers failure to fulfil the obligation to inform. We can say that the number of issuers who fail to meet their disclosure obligations towards the Stock Exchange has decreased in recent years. Due to the maturity date of bonds, BSSE in 2005 ended trading of 4 issues of government bonds, 3 issues of mortgage bonds and 4 issues of corporate bonds (including 2 prematurely redeemed issues) on the market of listed securities. Trading of 1 issue of corporate bonds ended on the regulated free market for the same reason. 11 SECURITIES ON STOCK EXCHANGE MARKETS

13 TRADING THE YEAR 2005 TRADING VOLUME STATISTICS In the year 2005, BSSE opened its electronic trading system to trading in 242 working days. The total financial volume of transactions amounted to billion Sk, which is an increase by 131.8% in comparison with the same period of the previous year. Notwithstanding the year s high financial volume of transactions, it must be said that trading in the period under review was not active enough. A total of valid transactions were closed, in which million units of securities were transferred. On a year-on-year basis, the number of transactions decreased by 38.7% and the number of transferred units of securities dropped by 10.9%. A major part of the year s relatively high traded volume is represented by negotiated deals, in which the financial volume of billion Sk was transferred in transactions. It is an increase by 142.5% on a year-on-year basis. Electronic order book (i.e. price-setting) transactions amounted to 8.2 billion Sk in transactions. The financial volume of REPO transactions in 2005 amounted to billion Sk, representing a year-on-year increase by 373.6%. This volume was achieved in 58 transactions, of which 18 transactions comprised either the purchase or sale of equity securities in the financial amount of million Sk. Transactions closed by non-residents in 2005 represented 50.9% (510.0 billion Sk) of the total volume of transactions, of which the buy side accounted for 51.5% and the sell side for 50.4% Change (%) NUMBER OF TRADING DAYS TOTAL VOLUME OF TRANSACTIONS (SK) ,8% AVERAGE DAILY VOLUME OF TRANSACTIONS (SK) ,7% SHARES AND PARTICIPATION CERTIFICATES TOTAL VOLUME OF TRANSACTIONS (SK) ,0% AVERAGE DAILY VOLUME OF TRANSACTIONS (SK) ,9% NUMBER OF ISSUES ,3% MARKET OF LISTED SECURITIES ,1% MARKET OF UNLISTED SECURITIES ,9% BONDS TOTAL VOLUME OF TRANSACTIONS (SK) ,3% AVERAGE DAILY VOLUME OF TRANSACTIONS (SK) ,3% NUMBER OF ISSUES ,4% MARKET OF LISTED SECURITIES ,3% MARKET OF UNLISTED SECURITIES ,0% 12 TRADING

14 TRADING OF SHARES On the last trading day of the year, transactions could be closed with 306 share issues (of 230 issuers), including 51 issues of participation certificates. That included 5 issues on the main listed market, 8 issues on the parallel listed market and 293 issues on the free market. As of the end of the year, no issue was registered on the new listed market. Market capitalisation of all negotiable issues of equity securities registered on the Stock Exchange markets increased, on a year-on-year basis, by 8.3% to billion Sk. Real market capitalisation, that is market capitalisation of that part of shares with which at least one electronic order book transaction had been closed (excluding the shares of investment funds plus participation certificates), rose by 12.2% and amounted to billion Sk (i.e. 92.9% of total capitalisation) on the last day of the year. Market capitalisation of the listed market totalled 78.9 billion Sk, strengthening by 15.0% on a year-on-year basis. Shares were bought or sold in transactions, in which the financial volume amounted only to 2.13 billion Sk. Thus the share transactions represent a tiny 0.2% of the year s total volume of transactions. Electronic order book transactions amounted to 0.43 billion Sk in transactions; negotiated deals totalled 1.7 billion Sk in transactions. From a perspective of achieved financial volume, the year 2005 s most successful share issues comprised Istrokapitál (401.9 million Sk; 14 transactions), Slovnaft (284.0 million Sk; 790 transactions) and SES Tlmače (208.8 million Sk; 490 transactions). Dominating the regulated free market, in terms of volume, was the issue of Slovenská plavba a prístavy (196.7 million Sk; 20 transactions). The shares of Všeobecná úverová banka not only achieved the highest number of closed transactions last year (1 105 transactions), but also became the most active listed issue (82.3 million Sk), from a perspective of financial volume, within the framework of electronic order book transactions. In the year 2005, 29 obligatory offers to take over expired on BSSE, including the following offers announced back in 2004: Unipharma, Tatramat, Slovenská Grafia, Slov Coupon, Bratislavské tlačiarne and V.B.P.K. In the period under review, BSSE executed a total of 23 new obligatory offers to take over. The financial volume within the framework of the obligatory offers amounted to million Sk in 860 transactions, representing 6.1% of the total volume and 10.9% of the total number of share transactions. The Slovak share index SAX experienced a considerably volatile development in the year 2005, alternating long-term periods of appreciation and decline. In general we can say that, with its year-end value of points, SAX strengthened in the period from 23 December 2004 by 26.5%, which is an increase by 86.7 points in absolute terms. The following are year-on-year changes of the base issues in the year 2005: Biotika (-37.7%; 200 Sk), OTP Banka Slovensko (+79.0%; 537 Sk), SES Tlmače (+144.4%; 440 Sk), Slovnaft (+10.7%; Sk), VÚB (+30.2%; Sk). At its meeting held on 27 January 2005, the SAX Index Commission decided to exclude the listed issue of Novitech (j.s.c.) from the base of the index. On 31 January the Commission again revised the weights of the base issues in order for one 13 TRADING

15 TRADING OF SHARES SAX INDEX DEVELOPMENT IN 2005 issue to not exceed the limit of 30%. BSSE had to extraordinarily revise the SAX index base only once on 18 July 2005 due to the end of trading of the share issue of Nafta (j.s.c.) on the main listed market. The total nominal value of the excluded issue equalled 3.23 billion Sk. INDEX VALUE 510,00 476,00 442,00 408,00 374,00 340,00 By the end of the year, the dividends of the following companies were paid out and factored in the index: Slovnaft (210 Sk; date of record: 2 May), VÚB (210 Sk; date of record: 4 May), Nafta ( Sk; date of record: 24 May) and SES Tlmače (65 Sk; date of record: 5 July). 306,00 I II III IV V VI VII VIII IX X XI XI TRADING OF BONDS As of the end of the year, 75 bond issues could be traded on the three Stock Exchange markets, including 30 issues on the main listed market, 38 issues on the parallel listed market and 7 issues on the regulated free market (including one issue of Eurobonds). On the last trading day of the year 2005, market capitalisation of debt issues amounted to billion Sk (+16.5% on a year-on-year basis), including the listed issues totalling billion Sk (+17.7% on a year-on-year basis). The volume of bond transactions in the period under review amounted to billion Sk, which corresponds to 5.7 million bond units traded in transactions. On a year-on-year basis, the traded financial volume rose by 143.3% and the number of transactions increased by 10.4%. A closer look at the structure of transactions reveals that the highest amounts were invested in the risk-free government bonds. Their total financial volume amounted to billion Sk (in transactions), representing a 99.6-percent share in the total volume of bond/share transactions. The listed issues in the segment of debt securities achieved a financial volume of billion Sk in transactions, accounting for as much as 99.9% of the volume of all bond transactions and for 99.7% of last year s total traded volume. Electronic order book transactions fell against the year 2004, in relative terms, by 44.5% to 7.8 billion Sk. 14 TRADING

16 TRADING OF BONDS THE CESI INDEX CLEARING AND SETTLEMENT OF TRANSACTIONS The following bond issues achieved the highest financial volumes: the restructuring government bond of series 142 (271.9 billion Sk; 81 transactions), the government bond of series 188 (225.1 billion Sk; 156 transactions) and the government bond of series 144 (77.9 billion Sk; 18 transactions). In the private sector the most successful was the issue of Technologické centrum (463.7 million Sk; 9 transactions), followed by mortgage bonds VÚB XIV (318.9 million Sk; 7 transactions) and corporate bonds B.O.F. 06 (187.3 million Sk; 41 transactions). The government bond of series 203 achieved not only the highest number of transactions (578), but also the highest financial volume in electronic order book translations (3.6 billion Sk). The SDXGroup index for public sector, represented by government bonds, ended the year at (price) and (performance), with a yield to maturity of 3.655% and duration of 4.36 years. The sub-index SDXG(<=5) ended the year at (price) and (performance), with a yield to maturity of 3.522% and duration of 2.25 years. The long-term sub-index SDXG(>5) closed at (price) and (performance), with a yield to maturity of 3.710% and duration of 7.21 years. The SDXGroup index for private sector, represented by corporate and mortgage bonds, ended the year at (price) and (performance), with a percent yield to maturity and duration of 3.07 years. At the end of the year, the value of the short-term sub-index SDXG(<=5) equalled (price) and (performance), offering a yield to maturity of 3.418% and duration of 1.79 years. The long-term sub-index SDXG(> 5) closed at (price) and (performance), with a yield to maturity of 3.828% and duration of 6.08 years. Two sittings of the CESI Committee were held last year. At the October sitting, following mutual agreement of the representatives of individual Stock Exchanges, the General Director of the Budapest Stock Exchange (which owns and manages the CESI index) decided to end the computation and publishing of this index. The last day of the computation and publishing of the CESI index was 30 December The CESI index was introduced in 1996 as a result of an effort for closer co-operation of the Stock Exchanges in the Central Europe. At that time the index fulfilled its very positive role as an indicator of the Central European countries markets. After the participating countries joined the EU, and due to further development of the capital markets of the V-4 countries, the requirements and priorities of the market participants changed. The CESI index gradually stopped meeting the needs of the market, which turned its focus on the benchmark indices (computed in real time). In comparison with the year 2004, the total number of securities transferred through BSSE decreased by 17.7% from units to units. Sixty-two transactions were suspended in the year Out of that, 58 transactions were settled within the T+4 term, 3 transactions within the T+5 term and 1 transaction within the T+7 term. In most cases the transactions were suspended due to delayed cancellation of the suspension of the right to dispose (PPN) of securities, or due to delayed sending of financial means. Nevertheless, the resources of the Guarantee Fund were not drawn. The number of securities delivered with delay equalled units (a decrease by 907 units against the year 2004) in the amount of Sk (a decrease by Sk against the year 2004). 15 TRADING / CLEARING AND SETTLEMENT OF TRANSACTIONS

17 MEMBERSHIP LIST OF MEMBERS AND ENTITIES AUTHORISED TO TRADE ON BSSE AS OF 31 DECEMBER As of 31 December 2005, BSSE had 27 regular members. The National Bank of Slovakia is an entity authorised to trade on the Stock Exchange by law. Companies FOCUS FINANCE (o.c.p. a.s.) and GASFIN (a.s. o.c.p.) ended their regular membership in the course of the year Regular membership of companies Invest BROKERS (o.c.p. a.s.) and Pro Partners (o.c.p. a.s.) terminated as of 31 December No. Name of member or, respectively, entity authorised to trade on BSSE 1 CAPITAL INVEST, o.c.p., a.s. 2 Capital Partners, o.c.p., a.s. 3 CALYON BANK SLOVAKIA a.s. 4 Československá obchodní banka, a.s. (ČR) prostredníctvom pobočky Československá obchodní banka, a.s., pobočka zahraničnej banky v SR 5 Dexia banka Slovensko a.s. 6 DLHOPIS, o.c.p., a.s. 7 HVB Bank Slovakia a.s. 8 ING Bank N.V. (Holandsko) prostredníctvom pobočky ING Bank N.V. pobočka zahraničnej banky 9 INVEST BROKERS, o.c.p., a.s.** 10 ISTROBANKA, a.s. 11 J&T SECURITIES (SLOVAKIA) o.c.p., a.s. 12 Komerční banka Bratislava, a.s. 13 ĽUDOVÁ BANKA, a.s. 14 Národná banka Slovenska* 15 OTP Banka Slovensko, a.s. 16 PALČO BROKERS, o.c.p., a.s. 17 Poštová banka, a.s. 18 Pro Partners, o.c.p., a.s.** 19 RM-S Market, o.c.p., a.s. 20 SEVISBROKERS FINANCE, o.c.p., a.s. 21 SLÁVIA CAPITAL, a.s., obchodník s cennými papiermi 22 Slovenská sporiteľňa, a.s. 23 Stredoeurópsky maklérsky dom, obchodník s cennými papiermi, akciová spoločnosť 24 Sympatia Financie, o.c.p., a.s. 25 Tatra banka, akciová spoločnosť 26 UniBanka, a.s. 27 V BROKERS, o.c.p., akciová spoločnosť 28 Všeobecná úverová banka, a.s. * Entity authorised to trade on BSSE ** Regular membership terminated on 31 December 2005 MEMBERSHIP

18 INSPECTION BSSE s inspection in the year 2005 was provided by the Stock Exchange Deals Inspection Department. The object of the Department s activity and the duties of its staff are governed by the Act on the Stock Exchange, the Stock Exchange Rules and BSSE s internal regulations. The Department s activity focused primarily on continuous monitoring of stock exchange transactions in the Stock Exchange s trading and clearing system, inspection of adherence to the Stock Exchange Rules and separate regulations pertaining to the inspected entities activity on the Stock Exchange as well as protection of financial market participants against market manipulation, against laundering of proceeds from criminal activity and against other such actions or behaviour of the financial market participants which could cause damage to other participants. In the course of the year 2005, the Stock Exchange Deals Inspection Department carried out systematic and complex inspection in the registered offices of 9 BSSE members, investigated an instigation (initiated by financial market participants) for one stock exchange transaction and continuously monitored all stock exchange transactions. On the basis of faults found during inspection of the members activity as securities dealers, the Stock Exchange imposed sanctions on two members. A part of inspection was the preparation of information on the basis of requirements of the Financial Market Authority. In the course of the year 2005, the Stock Exchange Deals Inspection Department settled - among other things - 33 requests for provision of background papers and statements, submitted by various sections of the Police Force of the Slovak Republic, as well as the courts and tax offices of the Slovak Republic. In compliance with the Act No 429/2002 (Coll.) on the Stock Exchange, the Department submitted a report on its activity to the Financial Market Authority after the end of every calendar quarter. EXTERNAL RELATIONS AND MARKETING In the course of the year 2005, the Stock Exchange participated in the activities of the Federation of European Securities Exchanges (FESE), the main mission of which is to ensure communication with institutions of the European Commission in the elaboration and adoption of EU legislation. FESE continuously provides its members with drafts of individual directives and recommendations, finalises the Federation members observations and lobbies for their acceptation by the relevant bodies of the European Commission. In the course of the previous year, great attention was paid to making observations to the draft implementation measures of the European Commission s directives, primarily to the Market in Financial Instruments Directive (MiFID), as well as other documents of a strategic character aimed at the European Commission s long-term objectives in the area of financial services leading to an increase of competitiveness of the European capital market (e.g. Green Paper on Financial Policy ). In February 2005 the Stock Exchange started co-operating with Profit magazine. In the Stock Exchange section of the magazine, BSSE published articles informing about the Stock Exchange s activity and results, current legislative changes 17 INSPECTION / EXTERNAL RELATIONS AND MARKETING

19 EXTERNAL RELATIONS AND MARKETING related to the capital market, selected issuers, dates of Stock Exchange training courses and activities of the Central European Corporate Governance Association (CECGA). During the entire year, the Stock Exchange published its daily price lists and BSSE announcements in Hospodárske noviny and Pravda dailies. Every year, Bratislava Stock Exchange increases the extent and quality of information provided on its website. Last year the Stock Exchange elaborated a document called Issuer s Handbook, which contains all information connected with the issue and admission of securities to BSSE. An innovated version of the Stock Exchange Bulletin, which had been only distributed to the listed companies and Stock Exchange members before, was put on the Stock Exchange s website at the start of the year Professional users and distributors of stock exchange data and information can choose from three basic information packages: data on trading in real time, data on trading after the close of trading and a complete service on issuers. Among the main subscribers of BSSE s information packages are Reuters SA, Bloomberg L.P., Thomson Financial Ltd, FT Interactive Data (Europe), Nomura Internatial plc, Telekurs Finanzinformationen AG, Emerging Markets Economic Data Ltd, Exchange Data International Ltd, Infin, s. r.o., Internet Securities Inc, press agencies SITA, TA SR and ČTK, as well as economic newspapers Hospodárske noviny, Pravda and Trend. 18 EXTERNAL RELATIONS AND MARKETING

20 ECONOMIC RESULTS FOR THE YEAR 2005 REVIEW OF THE YEAR 2005 AND ANTICIPATED DEVELOPMENT IN THE YEAR 2006 BALANCE SHEET AS AT 31 DECEMBER 2005 The Stock Exchange s revenues were surpassed by a large margin in as was the projected performance result - as a result of the high volume of transactions closed on the Stock Exchange floor, the volume of which exceeded the level of 1 billion Sk. For the year 2006, the Stock Exchange projects revenues of million Sk and expenses of million Sk. Profit before tax is projected in the amount of 4.6 million Sk. Privatisation of the Central Securities Depository of the Slovak Republic is to be realised in the year 2006, due to which the Stock Exchange will acquire a 100-percent business share in the central depository. From a perspective of influence of the external environment, we expect the Stock Exchange to continue its activity under the same conditions as in the year Description ASSETS Gross Provision Net Net a b c (Sk'000) (Sk'000) (Sk'000) (Sk'000) Total assets l l l l line Current accounting period Immediately preceding accounting period A. Amounts receivable for subscribed capital (353) B. Non-current assets l l l B.I. Total intangible fixed assets (l. 005 to l. 012) B.I.1. Incorporation expenses (011) - /071, 091A/ B.I.2. Research and development costs (012) - /072, 091A/ B.I.3. Software (013) - /073, 091A/ B.I.4. Valuable rights (014) - /074, 091A/ B.I.5. Goodwill (015) - /075, 091A/ B.I.6. Other intangible fixed assets (019, 01X) - /079, 07X, 091A/ B.I.7. Intangible fixed assets in acquisition (041) B.I.8. Advance payments for intangible fixed assets (051) - 095A ECONOMIC RESULTS FOR THE YEAR 2005 / BALANCE SHEET AS AT 31 DECEMBER 2005

21 BALANCE SHEET AS AT 31 DECEMBER 2005 Description ASSETS B.II. Total tangible fixed assets (l. 014 to l. 022) line Current accounting period Immediately preceding accounting period Gross Provision Net Net a b c (Sk'000) (Sk'000) (Sk'000) (Sk'000) B.II.1. Land (031) - 092A B.II.2. Structures (021) - /081, 092A) B.II.3. Separate movable assets and sets of movables (022) - /082, 092A/ B.II.4. Natural agricultural assets (025) - /085, 092A/ B.II.5. Livestock and draught animals (026) - /086, 092A/ B.II.6. Other tangible fixed assets (029, 02X, 032) - /089, 08X, 092A/ B.II.7. Tangible fixed assets in acquisition (042) B.II.8. Advance payments for tangible fixed assets (052) - 095A B.II.9. Correction item to acquired assets (+/- 097) +/ B.III. Total long-term financial investments (l. 024 to 031) B.III.1. Shares and ownership interests in subsidiaries (061) - 096A B.III.2. Shares and ownership interests in associates (062) - 096A B.III.3. Other long-term securities and ownership interests (063, 065) - 096A B.III.4. Loans to entities in consolidation field (066A) - 096A B.III.5. Other long-term financial assets (067A, 069, 06XA) - 096A B.III.6. Loans due in one year (066A, 067A, 06XA) - 096A B.III.7. Long-term financial assets in acquisition (043) - 096A B.III.8. Advance payments for long-term financial assets (053) - 095A ECONOMIC RESULTS FOR THE YEAR 2005 / BALANCE SHEET AS AT 31 DECEMBER 2005

22 BALANCE SHEET AS AT 31 DECEMBER 2005 Description ASSETS C. Current assets l l l l C.I. Total inventory ( l. 034 to 040) C.I.1. Material (112, 119, 11X) - /191, 19X/ C.I.2. Work-in-progress and semi-finished goods (121,122,12X)-/192,193,19X/ line Current accounting period Immediately preceding accounting period Gross Provision Net Net a b c (Sk'000) (Sk'000) (Sk'000) (Sk'000) C.I.3. Construction contracts with anticipated expiry period exceeding one year 12X - 192A C.I.4. Finished goods (123) C.I.5. Livestock (124) C.I.6. Merchandise (132, 13X, 139) - /196, 19X/ C.I.7. Advance payments for inventory (314A) - 391A C.II. Total long-term receivables (l. 042 to l. 047) C.II.1. Trade receivables (311A, 312A, 313A, 314A, 315A, 31XA) - 391A C.II.2. Receivables from subsidiaries and parent company (351A) - 391A C.II.3. Other receivables from entities in consolidation field (351A) - 391A C.II.4. Receivables from partners, members and association (354A, 355A, 358A, 35XA) - 391A C.II.5. Other receivables (335A, 33XA, 371A, 373A, 374A, 375A, 376A, 378A) - 391A C.II.6. Deferred tax asset (481A) ECONOMIC RESULTS FOR THE YEAR 2005 / BALANCE SHEET AS AT 31 DECEMBER 2005

23 BALANCE SHEET AS AT 31 DECEMBER 2005 Description ASSETS C.III. Total short-term receivables (l. 049 to 055) C.III.1. Trade receivables (311A, 312A, 313A, 314A, 315A, 31XA) - 391A C.III.2. Receivables from subsidiaries and parent company (351A) - 391A C.III.3. Other receivables from entities in consolidation field (351A) - 391A line Current accounting period Immediately preceding accounting period Gross Provision Net Net a b c (Sk'000) (Sk'000) (Sk'000) (Sk'000) C.III.4. Receivables from partners, members and association (354A, 355A, 358A, 35XA, 398A) - 391A C.III.5. Social insurance (336) - 391A C.III.6. Tax assets (341, 342, 343, 345) - 391A C.III.7. Other receivables (335A,33XA,371A,373A,374A,375A,376A,378A)- 391A C.IV. Total financial accounts (l. 057 to l. 061) C.IV.1. Cash in hand (211, 213, 21X) C.IV.2. Bank accounts (221A, 22X +/-261) C.IV.3. Bank accounts bound for period exceeding one year 22XA C.IV.4. Short-term financial assets (251, 253, 256, 257, 25X) - /291, 29X/ C.IV.3. Short-term financial assets in acquisition (259) D.I. Total accrued and deferred items l. 063 and l D.I.1. Prepaid expenses (381, 382) D.I.2. Accrued income (385) Control number total (l. 001 to l. 064) ECONOMIC RESULTS FOR THE YEAR 2005 / BALANCE SHEET AS AT 31 DECEMBER 2005

24 BALANCE SHEET AS AT 31 DECEMBER 2005 Description EQUITY AND LIABILITIES Total liabilities and equity l l l A. Equity l l l l l A.I. Total registered capital (l. 068 to 070) A.I.1. Registered capital (411 or +/- 491) A.I.2. Treasury stock and treasury shares (/-/252) A.I.3. Changes in registered capital +/ A.II. Total capital funds (l. 072 to 077) A.II.1. Share premium (412) A.II.2. Other capital funds (413) A.II.3. Legal reserve fund (Non-distributable fund) from capital contributions (417, 418) A.II.4. Asset and liability revaluation reserve (+/- 414) A.II.5. Financial investments revaluation reserve (+/- 415) A.II.4. Revaluation reserve from fusions, mergers and separations (+/- 416) A.III. Total funds from profits (l. 079 to 081) A.III.1. Legal reserve fund (421) A.III.2. Non-distributable fund (422) A.III.3. Statutory and other funds (423, 427, 42X) A.IV. Profit/loss from prior years l l A.IV.1. Retained earnings from prior years (428) A.IV.2. Accumulated losses from prior years (/-/429) A.V. Profit/loss for current accounting period /+-/ l (l l l l l l. 116) B. Liabilities l l l l B.I. Total provisions (l. 088 to l. 090) B.I.1. Legal provisions (451A) B.I.2. Other long-term provisions (459A, 45XA) B.I.3. Current provisions (323, 32X, 451A, 459A, 45XA) line Current accounting period Immediately preceding accounting period 5 6 a b c (Sk'000) (Sk'000) 23 ECONOMIC RESULTS FOR THE YEAR 2005 / BALANCE SHEET AS AT 31 DECEMBER 2005

25 BALANCE SHEET AS AT 31 DECEMBER Description EQUITY AND LIABILITIES B.II. Total long-term liabilities (l. 092 to l. 101) B.II.1. Long-term trade liabilities (479A) B.II.2. Long-term liabilities unbilled (476A) B.II.3. Long-term liabilities to subsidiaries and parent company (471A) B.II.4. Other long-term liabilities to entities in consolidation field (471A) B.II.5. Long-term advance payments received (475A) B.II.6. Long-term bills of exchange to be paid (478A) B.II.7. Bonds issued (473A/-/255A) B.II.8. Social fund payable (472) B.II.9. Other long-term payables (474A, 479A, 47XA, 372A, 373A, 377A) B.II.10. Deferred tax liability (481A) B.III. Total short-term liabilities (l. 103 to l. 111) B.III.1. Trade payables (321, 322, 324, 325, 32X,475A, 478A, 479A, 47XA) B.III.2. Short-term liabilities unbilled (326, 476A) B.III.3. Liabilities to subsidiaries and parent company (361A, 471A) B.III.4. Other liabilities to entities in consolidation field (361A, 36XA, 471A, 47XA) B.III.5. Payable to partners and association (364,365,366,367,368,398A,478A,479A) B.III.6. Employee liabilities (331, 333, 33X, 479A) B.III.7. Social insurance payables (336, 479A) B.III.8. Tax liability and subsidies (341, 342, 343, 345, 346, 347, 34X) B.III.9. Other payable (372A, 373A, 377A, 379A, 474A, 479A, 47X) B.IV. Total bank loans and financial assistance (l. 113 to l. 115) B.IV.1. Long-term bank loans (461A, 46XA) B.IV.2. Short-term bank loans (221A, 231, 232, 23X, 461A, 46XA) B.IV.3. Short-term financial assistance (241, 249, 24X, 473A, /-/255A) C. Total accrued and deferred items (l. 117 a l. 118) C.I.1. Accrued expenses (383) C.I.2. Deferred income (384) Control number total (l. 065 to l. 118) ECONOMIC RESULTS FOR THE YEAR 2005 / BALANCE SHEET AS AT 31 DECEMBER 2005 line Current accounting period Immediately preceding accounting period 5 6 a b c (Sk'000) (Sk'000)