Bolsa de Valores de Colombia Corporate Presentation

Transcription

1 Bolsa de Valores de Colombia Corporate Presentation December

2 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 2

3 History 89 years creating and transforming Colombian capital market Founding of Bolsa de Bogota Founding of Bolsa de Medellin DECEVAL Central Securities Depository starts operations Founding of Bolsa de Occidente 1st dematerialized security \ \ \ \ Z \ Last outcry trading session Colombian market becomes electronic Full fungibility of securities Creation of the BVC as a result of the merger of Bogota, Medellin and Occidente Exchanges CCDC (FX clearing house) starts operations SET Icap starts operations CRCC (CCP) starts operations Fixed Income electronic trading platform BVC became a listed public company Launching of the standardized derivatives market Precia (price vendor company) starts operations Launching of Xstream trading platform by NASDAQ - OMX Launching of MILA Sophos Acquisition BVC Deceval Corporate Integration Dec Starts operating as a single company Continuous development of the Colombian Capital Market infrastructure 3

4 Bolsa de Valores de Colombia We are the strategic partner of the financial and capital market sectors in trading, issuers, post-trading, information, and technology services. Our Value Proposition Our Strengths Capital Markets & Issuer Services Equities Fixed Income Derivatives FX OTC Issuer Services Shareholding 50% 100% Solid revenues* growth in the last 5 years Diversified and Vertically Integrated business model Operating Rev. COP$ 223 billion Trading 18% LTM 3Q18 Listings 27% Revenues Growth Post- Trading 29% CAGR Mkt Info 14% 11% IT 29% Z Z Z Post-Trading Services Information Services Technology Solutions & Innovation *2018 Proforma figures **Present value Clearing Settlement Custody Market Data Assets Valuation Risk Management Tools Trading Systems Electronic Access Consultancy: Core Banking Treasury Capital Markets ***Estimated using the closing price of COP$ as of Sep % 31% 100% 54% Value Creation distributing dividends to shareholders since listed More than COP$ 376 billion ** Recurrent revenues 82% Market cap COP$ 787 billion Revenues Dividend Growth Yield 5,3% 2018*** 4

5 Colombian Capital Market Structure bvc has built and is present throughout the value chain Equities Fixed Income FX Derivatives Pre-trading Trading Post-trading Others Mkt Shr TACC Issuers Services Issuances Access Trading OTC Clearing Settlement Custody Securities Administration Reporting / Information Technology & Innovation 100% 4% 30% 4% 70% 1% 10% 6% OTC 70% OTC 26% 5

6 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 6

7 New Consolidated Strategic Vision Vision Being the market infrastructure that serves the country in the most effective and efficient way, focused on our clients needs and the construction of trust, leading the Colombian capital market development and the regional integration, creating value for our shareholders and stakeholders How to Win? Where to Play? Operational efficiency Total transformation toward a client focused organization Customer Centricity Promote liquidity and foster development of our capital market Innovation, digital transformation and diversification Core Strengthening New business Development Operate as a single entity Redesign industry processes Priorities Implement a new commercial management and segmentation model Implement strategic projects 7

8 Strategic Pillars Operational efficiency Total transformation toward a client focused organization Customer Centricity Promote liquidity and foster development of our capital market Innovation, digital transformation and diversification Consolidation of the value chain Internal alignment of the new company Identification of clients needs Being a competitive and important financing source for companies Innovation culture Optimization of industry processes Technological capabilities Quality service Improvement of the cost-benefit ratio Differentiation in levels of service Attract local and international liquidity New businesses and transformation We maximize operational efficiency throughout the value chain We do what the client needs to be successful We drive market growth Innovation culture as an transformation engine 8

9 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 9

10 bvc Business Lines A Complete Portfolio of Services Throughout the Market Infrastructure Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation Growth Drivers Turnover - Interconnected Markets - Efficiency & Market Integrity Massification IT & Info Services that support Automation Regional Scope 10

11 bvc Business Lines Diversified Business and Attractive Revenue Distribution 82% Recurring revenues 29% 11% Operational Revenues COP $223 Billion 18% 27% Solid and competitive financial Position with attractive shareholders returns Operational Revenues Total Expenses & Costs Consolidated (bvc + subsidiaries) LTM 3Q18** $223 $166 14% Adj. EBITDA* / Margin $86 / 39% Capital Markets Post-Trading Technology Solutions & Innovation Issuer Services Information Services Other Revenues The integration with deceval has brought an expansion of recurrent revenues in post-trading, maintaining the potential upside in trading revenues creating greater scale and financial strength Adj. Net Profit* / Margin Dividends 2017 Dividend payout*** / Yield $54 / 24% $38 70% / 5,3% Figures in COP $ billions *Adjusted to integration-related expenses **Consolidated Proforma LTM 3Q18 ***Dividend policy: 70% ordinary Estimated using the closing price of COP$ as of Sep

12 bvc Business Lines Resilient, Attractive and Diversified Revenue Mix Revenues by Company Revenues by Type 4% 18% 29% 30% 37% 82% BVC Deceval Sophos Precia Trading Revenues Non Trading Revenues Valuable portfolio businesses expansion through organic initiatives and acquisitions Greater participation of non-trading revenues reducing volatility and increasing resilience Pro Forma Operating Revenues LTM 3Q18 12

13 BOLSA DE VALORES DE COLOMBIA - bvc Overview Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 13

14 Capital Markets bvc organizes the markets to ensure their eligibility using technology to foster growth, facilitate the execution of trading strategies, and bring access to more participants Volume & Transaction Driven Revenue Business Line Fixed Income Market: Electronic trading and OTC registration services on public & corporate debt and money market transactions Equity Market: Electronic trading on cash equities, securities lending, repos, ETFs, and foreign securities Derivatives Market: Electronic trading and OTC registration services on futures (interest rates, equities, fx), options and swaps Deceval s Business Line Securities Administration: direct payment of dividends and interests to investors. Revenue Contribution LTM 3Q18 18% Capital Markets Revenue 41, ,3 40, ,5 Main Drivers: Interest rates Outlook for listed companies and the Colombian economy Risk appetite and sophistication level of investors FX volatility LTM 3Q18 *Pro Forma figures in COP$ Billions Fixed Income Equity Market Derivatives Securities Administration 14

15 Capital Markets bvc organizes the markets to ensure their eligibility using technology to foster growth, facilitate the execution of trading strategies, and bring access to more participants Fixed Income Equity Market Our Results CAGR 14-18*: +1% CAGR 14-18*: -2% Fixed Income Market 100% corp. debt market share 23% Gov debt market share Equity Market 100% market share 28% traded volume by foreign Investors LTM 2018* Electronic OTC LTM 2018* Cash Equity Repos Securities Lending Derivatives Market Vol. in bvc: Standardized: 16% and OTC: 84% 45% traded by 3 rd parties FX Market 70% market share 100% share of electronic trading Derivatives (Volume) CAGR 14-18*: +22% Securities Administration CAGR 14-18*: +7% FX USD (Billions) CAGR 14-18*: +1% LTM 2018* Standardized OTC Traded Volume in COP$ Trillions. *As of Oct 2018 Derivatives Includes: Standardized (futures) and OTC (NDF, Swaps) LTM 2018* Securities Administration OTC Derivatives and FX through Set-Icap LTM 2018* 15

16 Issuer Services The Colombian Capital Market is a recognized financing alternative for companies Recurring Revenue Business Line: Securities listing: Fixed income: Listing and annual maintenance fees vary for type of security and sector. Financial institutions (fixed fee) and real sector (% of the amount issued or in stock) Equities: Listing and annual maintenance fees are priced according to shareholder s equity as of Dec 31 of each year Issuances and public offerings: IPOs, Follow-Ons, Fixed income issuances, Tender Offers Deceval s Business Line Deposit of Issuances: dematerialized securities services, administrations of stock and bond holders; and book entry services The BVC promotes among listed companies the adoption of best practices on disclosure and investor relations (IR). IR Recognition is the guidance for the Colombian securities market adopted voluntarily by the BVC issuers. Revenue Contribution LTM 3Q18 27% Issuer Services Revenue 49,0 46,6 54,4 52,1 59,2 Main Drivers: Annual listing fees charged to listed companies Number and size of bond issuances, tender offers, follow-on, and IPOs Administration of bond and stock holders LTM 3Q18 *Pro Forma figures in COP$ Billions Annual Listing Fees Listing Services Deposit Of Issuances 16

17 Issuer Services The Colombian Capital Market is a recognized financing alternative for companies , LTM 2018* # of Listed Issuers 3 Fixed Income Equities Public Offerings * Total Amount Issued (COP Trillions) CAGR 14-18*: +1% 10.6 Securities Under Custody (COP Trillions) CAGR 14-18*: +3% LTM 2018* Issuances COP$88 trillion * Green Bonds: COP $1,8 trillion issued Securities Under Custody Our Results IR Recognition issuers 26 reporting sustainability on GRI Innovation: Development of electronic systems that promote and guarantee transparency (book administration, Dutch auctions and other mechanisms for asset allocation) Issuer Services Strategy: $483 Trillion Specific financing needs Foster liquidity on equities and fixed income A2CENSO: mini bonds market for SMEs Promissory Notes: +1,2 Million digital notes under custody Fixed Income Equity ETF Securities under Custody *As of Oct

18 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 18

19 Post-trading Services Stable and resilient business line coming from the CSD Business Lines Clearing & settlement: DVP transactions: Delivery Versus Payment LP Transactions: Free of Payment of securities Custody: Custody services of local and foreign securities for direct custodians. Revenue Contribution LTM 3Q18 Revenues by Business Line 14% 29, , , , , Main Drivers: Securities under custody DVP & LP transactions coming from Equity and Fixed Income market LTM 3Q18 *Pro Forma Figures in COP$ Billions Custody LP DVP 19

20 Post-Trading Services Consolidating the Colombian Capital Market Infrastructure Dematerialized Issuances (COP Trillions) CAGR 14-18*: +4% Main Services: Dematerialized Issuances $465 Trillion LTM 2018* 532 Issuances 183 custodians 1, , Dematerialized Issuances Transactions (Millions) 1, ,6 1, Million Transactions LTM 3Q M Promissory Notes LTM 2018* Source: DECEVAL Figures as of Oct 2018 DVP LP 20

21 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 21

22 Information Services Information and knowledge at the service of financial and capital markets We use technology, analytics and digital marketing to grow our business and provide broader access Fee-Based & Subscription Revenue Business Line Revenue Contribution Terminals: market screens Knowledge services: Intermediary Access: electronic access services for trading, back office, custodians, and infrastructure providers Market Data: real-time information for vendors, development & licensing of indices, e-bvc (web & app) The Main price vendor in Colombia Products: Valuation services of market securities and non-liquid assets Risk and portfolio management tools Indices Mutual funds data Academic Line: market training, virtual courses, academic programs for retail investors and certificates Contests and simulators: For universities & schools Digital strategy: websites and social media 11% LTM 3Q18 Information Services Revenue 16, , , , Main Drivers: Market participants access Market data for vendors and sub-vendors AUM of ETFs Securities valuation services for market participants # of participants in bvc courses LTM 3Q18 Terminals Intermediary Access Market Data Price Vendor (Precia) Education *Figures in COP$ Billions 22

23 Information Services Information and knowledge at the service of financial and capital markets We use technology, analytics and digital marketing to grow our business and provide broader access # of Vendors % Electronic orders SAE Our Results CAGR 14-18*: +10% * 4% 3% 6% 8% 8% 96% 97% 94% 92% 92% * SAE Terminals 97% Daily Electronic orders through SAE +3 licensed indices Alliance with BlackRock Precia Assets valuated Participants educated at the BVC * AUM ETF icolcap (COP Trillions) # of Participants in BVC courses (thousands) Information Services Strategy: CAGR 14-18*: +11% Financial information Hub Analytics and second-generation services Real time data for risk management and automated trading Broader access through education and digital channels * * *As of Oct

24 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 24

25 Sophos Leverages our IT Strategy A regional player specialized in IT services for banking, capital markets and digital channels Revenue Contribution Recurring Revenue Business Line Regional experience and in depth knowledge of our clients business 15 years experience 41 clients in Colombia and 10 clients in Latin America ISO 9001 & CMMI Regulatory and industry expertise Sophos Revenues 26, , Specialized implementation and integration services Core banking solutions Treasury solutions Credit & debit cards processing solutions Digital channels Design, development and testing Propietary Software 62, , Partner of the leading worldwide providers 65, Latam: 12% Col: 88% Main Drivers: Deepening on existing local clients: 41 Regional expansion: 10 Latam clients Solutions for capital market participants Digital solutions 29% LTM 3Q18 EBITDA margin 22% LTM 3Q18 Net margin 14% LTM 3Q18 Revenue growth 30% CAGR EBITDA growth 24% CAGR *Figures in COP$ Billions LTM 3Q18 Colombia Other Mexico Chile Panama 25

26 BOLSA DE VALORES DE COLOMBIA - bvc Overview New Strategy Our Business Lines: Capital Markets & Issuer Services Post-Trading Services Information Services Technology Solutions & Innovation BVC Financial Highlights 26

27 bvc Financial Highlights 42.4% EBITDA 33.5% 33.6% EBITDA Margin 36.5% CAGR BVC 14-18*: +26% 38.8% 32.4% 22.9% Net Profit 20.4% Net Margin CAGR BVC 14-18*: +18% 24.1% 19.7% * LTM 3Q18* Balance Sheet Assets Liabilities Equity * LTM 3Q18* RoA RoE 25% 24% 22% % 16% 18% 8% 11% * LTM 3Q18* *Pro Forma figures in COP$ Billions *EBITDA & Net profits Adjusted to integration-related expenses in 2017 and LTM 3Q * LTM 3Q18* 7% 9% 27

28 bvc Financial Highlights Attractive dividend payout ratio and dividend yield P/E EV/EBIT P/BV Average Ratios Global Listed Exchanges EPS ,5 BVC BCS BVL BMV B3 BYMA * LTM 3Q18* Cash Flow CAGR 14-18*: +11% 5.2% Dividends Div. Yield 5.3% % 4.1% 4.0% LTM 3Q18 Payout * LTM 3Q18* Ratio 127% 70% 71% 70% 162% *Pro Forma figures in COP$ Billions 28

29 bvc Financial Highlights Focus and strict control on expenses to capture synergies Combined Expenses* Consolidated Expenses Distribution 29% 2% LTM 3Q18 26% Costs Employee Benefit Expenses Depreciation & Amortization Expenses % 35% Other Ordinary Expenses Projects * LTM 3Q18* BVC Deceval COP ~$8 billion annual cost synergies expected to be captured by the end of 2019, significant savings related to business optimizations Figures in COP $ billions *Combined Proforma LTM 3Q18 *Adjusted to integration-related expenses 29

30 bvc: Subsidiaries & Long Term Investments Inorganic growth through core assets investments Op. Revenues EBITDA Net Profit $ (+8% YoY) $ (-4% YoY) $ (+2% YoY) Op. Revenues EBITDA Net Profit $ (-2% YoY) $ (-6% YoY) $9.433 (+23% YoY) 100% Op. Revenues EBITDA Net Profit $ (+21% YoY) $7.528 (+31% YoY) $6.603 (+38% YoY) BVC investments has strengthen the revenue diversification strategy becoming the main market infrastructure provider in Colombia, improving and expanding distribution channels and revenues resiliency 47% 54% Op. Revenues EBITDA Net Profit $8.675 (+17% YoY) $3.169 (+8% YoY) $1.825 (+11% YoY) 100% 50% 50% Op. Revenues $ (+11% YoY) 31% Op. Revenues EBITDA Net Profit Op. Revenues $9.334 (+1% YoY) EBITDA $3.385 (-0.3% YoY) Net Profit $2.245 (+3% YoY) $147 (+9% YoY) $-393 (-29% YoY) $-632 (-35% YoY) Dividends from Subsidiaries VAR % Payment date Deceval % Jun 27 Sophos % Jun 29 & Oct 31 Precia % Apr 30 & Jun 29 Set-Icap % Apr 27 CRCC n/a Apr 30 CCDC % Mar 23 Total % Subsidiaries Joint Ventures Long Term Investments EBITDA Net Profit Figures in COP$ Millions as of LTM 3Q18 $ (+14% YoY) $7.702 (+14% YoY) 30

31 Corporate Governance & Ownership Structure Banks and Foreign investors represent the largest shareholders Shareholders Distribution No. SHAREHOLDERS % SHARE 1 BBVA COLOMBIA S.A. 7.33% 2 BANCO DAVIVIENDA S.A. 6.32% 3 B3 S.A. - BRASIL BOLSA BALCAO 6.11% 4 ITAU CORPBANCA COLOMBIA SA 5.74% 5 BANCARD INTERNATIONAL INVESTMENT INC 5.74% 6 FONDO DE PENSIONES OBLIGATORIAS PORVENIR MODERADO 4.69% 7 UNIVERSIDAD DE MEDELLIN 4.14% 8 CORPORACION FINANCIERA COLOMBIANA S.A. 4.04% 9 BANCO CAJA SOCIAL 3.97% 10 BMO INVESTMENTS II (IRELAND) PLC 3.77% 11 BANCOLOMBIA - BOGOTA 3.25% 12 MILLVILLE OPPORTUNITIES MASTER FUND LP 3.16% 13 INVERSIONES CFNS S.A.S. 2.67% 14 UTILICO EMERGING MARKETS LIMITED 2.00% 15 BROWN ADVISORY LATIN AMERICAN FUND 1.98% 16 VALORES BANCOLOMBIA S.A. COMISIONISTA DE BOLSA S A 1.80% 17 FONDO BURSATIL ISHARES COLCAP 1.50% 18 KAPITALFORENINGEN EMERGING MARKETS LONG-TERM ECONO 1.25% 19 AMBER GLOBAL OPPORTUNITIES LTD 1.18% 20 FIDUCIARIA BANCOLOMBIA S.A. 1.18% 21 FDO DE PENSIONES OBLIGATORIAS PROTECCION MODERADO 1.11% 22 BANCA DE INVERSION BANCOLOMBIA S.A CORP FINANCIERA 1.10% 23 LONDOÑO Y RESTREPO S.A. 1.04% 24 BANCO COLPATRIA MULTIBANCA COLPATRIA S.A. 0.93% 25 FONDO DE PENSIONES OBLIGATORIAS COLFONDOS MODERADO 0.90% As of November 30, 2018 *According to the article of decree % 31% 2% 4% 4% 1.7% 9% 41% Brokerage Firms Banks Foreign Investors Pension Funds Real Sector Universities Individuals Mutual Funds 7 Independent Members Committees: Regulation Corporate Governance Board of Directors 13 Administrative and Financial Audit 6 Non-Independent Members Risks Technology bvc Stock: Listed since June 22nd Free Float: 55%* Stock type: Common voting shares Shares outstanding: (reverse split held on Apr 30, 2018) 10% shareholding restriction according to Colombian law 510 of 1999 All brokers must have 182K shares (0,3%) to trade at the Colombian market. 31

32 Thank You For further information please contact: Carlos Barrios Director of Investor Relations Office & Sustainability Bolsa de Valores de Colombia Tel. (+57 1) Ext

33 Appendix 33

34 Capital markets to support the challenges Further actions Issuers Trading Central Counterparty Clearing House Potential Issuers: Active conversation with Colombian companies, more than 25 commercial visits New Issuance Prospect Standard: Standardized and simplified electronic issuance prospect reducing time and costs for equities and fixed income Listing Fees Reductions: bvc: $0 listing fee for issuances under COP$50 Bn (USD$16Mn) SFC: listing & annual fees - 60% avg New Trading Platform Stimulate multi-market strategies Leverage the cash equities market s growth through the development of the future's and option s market Trading of real-estate funds in the equity market in progress 2019 Trading Fee Reductions: since Jan 2018 Average Trading Fee 22% 1.6 PBS CCP for Equities Market: Securities: Stocks, ETFs, Repos, MILA and Colombian global market Settlement Cycle: transition period in the migration process from T+3 to T+2 aligned with international standards Securities Lending: C&S at the CCP fostering the participation and readiness of Pension Funds, Custodians and ETF Administrators Go Live: 3Q19 34

35 bvc 3Q18 Highlights Driving Market Growth and Operational Efficiencies Market Summary* Financial Figures 3Q18* Strategic Milestones Fixed Income: COP$ 940TN (+9% YoY) Equities: COP$ 39TN (+13% YoY) Derivatives: COP$ 662TN (+31% YoY) FX: USD$ 249BN (+14% YoY) Public Offerings & Issuances: COP$ 14TN (+41% YoY) Custody: COP$ 483TN (+1,4% YoY) *Consolidated Financials : bvc + deceval ** Adjusted to integration-related expenses Total Revenues: COP$ Million +46% YoY EBITDA**: COP$ Million +80% YoY Net Profits: COP$ Million +96% YoY Dividends: COP$ Million +85% YoY Payment dates: Jun 29 & Oct 31 Corporate Integration: 97% progress of integration milestones up to 3Q18 80% of synergies already captured Start of consultancy projects for: New commercial model Redesign of market processes Market Developments: New standard prospect for shares and bonds Launching of new green products business lines: Green, Social & Sustainable Bonds New Core System Projects: INET Master trader Phase 1, Public debt, went live in Sep 2018 New CSD system provided by TATA technology 2 year project, 98% progress in the analysis phase 35

36 INET Master Trader Project BVC Trading Platform Upgrade - All Markets in One Single Trading Platform Integrated Platform Fixed Income Private Debt MEC Plus 8.3 Derivatives X-stream TW Equities Derivatives X-stream Classic X-stream INET Integrated Platform Fixed Income Private Debt MILA UTrader Fixed Income Public Debt* Equities Derivatives X-stream Classic Fixed Income Public Debt* MILA Equities X-stream TW Master Trader: All Markets X-stream INET Fixed Income Private Debt MEC Plus 8.1 Master Trader: Fixed Income Market G.R. Pre-Trade Fixed Income Public Debt MEC Plus Phase 2: 3Q19 GR Dated Trading Infrastructure Phase 1: 10 Sep 2018 MILA Rapid Addition UTrader MEC Plus 8.3 Rapid Addition Efficient and Optimized Trading Infrastructure New Features: Migration to: Nasdaq X-Stream INET *Includes: Primary and secondary market Single trading platform for all Markets Pre-trade risk management Market monitoring capabilities Algorithmic and HFT protocols 36

37 Amarẃ Project New CSD System Aims to improve Deceval s international risk rating with an operational, technological and functional transformation that responds to global securities markets standards and mitigates the associated risks TCS BaNCS Solution (TATA Technologies): Strengthens the depository services and other business lines Boosts innovation and promotes new industry services Ensures better risk management practices Restructuring Benefits Operational Adoption of TCS BaNCS 10 Macro processes, 24 sub processes and 166 procedures impacted Restructuring of processes for global standards alignment IOSCO, BIS Principles Technological Web based world class solution with real time processing Meets the global standards of infrastructure of financial markets FIX Communications Protocol Functional The organizational infrastructure will be adjusted following the new implementation of processes Changes in regulation and operation, as well as new contracts for our clients Technological Update (Web Access, STP*, Flow of operations control) Higher Availability (Financial Assets and Securities Market Resources) Improvement of the C&S Processes (Bilateral / Multilateral) Better Interoperability (B2B) Enhanced Efficiency (BIS2** y BIS3** Models for C&S) Fostered Transparency (For users) Greater Fluency (Local and Global interaction under international standards) Greater Operational Risk Mitigation Improvement in the Risk Rating *Straight Through Processing ** Bank for International Settlements Standards 37

38 A2censo: Mini bonds for SMEs The 1st crowd funding platform in Colombia managed by the bvc a2censo is a digital ecosystem that seeks to connects in an agile way Colombian SMEs with potential investor to finance their projects a2censo allows financing access for SMEs, bringing investment alternatives to Colombians; thorough the implementation advantages evidenced in this type of platforms around the world Regulation in place: the Crowd funding decree 1357 issued on July 31 st, 2018 Mini bonds for SMEs: no secondary market Available for all: type of investors For SMEs with: revenues COP 3MM - 50MM and minimum of 3 years in operation Go live in 3Q19 Strategic Partners Product Develpment SME Promoters Anchor Investor and New Partners Regulation 38

39 Electronic Invoices Registration System - REFEL Partners: The National Government is ruling the trading of electronic invoices as securities. The mentioned regulation involves the Electronic Invoices Registration (REFEL) and the Invoices Trading System (SNE). (Tender Offer process by the Ministry of Commerce, Industry and Tourism MINCIT). Objectives: Win the tender offer for Electronic Invoicing Registration System - REFEL, which will allow the trading of electronic invoices as securities in the Colombian Market To Provide the trading system for the electronic invoices. Experience: Proven experience in trading, registration and custody services Technologically and regionally competitive Managing securities +COP$483 trillion at the CSD Proven experience managing financial transactions 39

40 Sophos Solutions: Strategic partners on the digital transformation for financial and capital markets players in the region Value Proposition Geographical Presence Strengths ZBanking Implementation, integration and evolution of Core Banking systems in partnership with the main global software houses Development of Sophos-branded applications Mexico 4 clients Panama 2 clients Colombia 41 clients Operational Revenues Growth 48% CAGR Diversified Revenue Sources ZCapital Markets ZDigital Implementation, integration and evolution of Core Treasury systems in partnership with the main global software houses Development, implementation, integration and evolution of applications and solutions for players in capital markets infrastructure Development of digital applications and solutions Deployment of specific digital capabilities for clients Offices Projects Ecuador 1 client Chile 2 clients Argentina 1 client 80% Banking Colombia 2017 Profitability Gross Margin Projects 15% Banking Region EBITDA Margin Average % 29% 5% Capital Markets 40

41 Sophos Solutions: A differentiated and competitive value Proposition that has allowed us to generate sustainable results Geographical Scope Global Principal IT Services Providers for the Financial Sector Infosys, Finastra, Oracle Revenues Sophos CAGR : 18% 2 nd growth rank From 12 th to 8 th ranking by revenues Accenture (ACN), Tata (TCS), Indra, Globant Indra TCS Globant Sophos Everis (NTT), Stefanini, Sonda Sophos Intergrupo, Heisonhn Ebitda Growth : 16% 5 th growth ranking From 3 rd to 2 nd in EBITDA ranking Choucair, Seti, Pragma, Personalsoft Indra TCS Globant Sophos Local IT Consultancy Multinational, SW provider, Listed company Multinational, listed company Multi-Latin, privately owned Colombia-focused, privately owned System Inegration Business Scope Application Outsourcing BPO 2017 Ebitda % 23% 5% 9% 10% Indra TCS Globant Sophos Sophos Average : 28% 1 st average ranking st EBITDA% ranking Source: Sophos, BVC 2017 Figures in USD Millions 41

42 Sophos Solutions We enable innovation and digital transformation in our clients Banking Growth Drivers Fostering regional growth Deepening relationships with existing clients Strengthening our relationships with global Core Banking software partners Developing Sophos-Branded SaaS solutions Digital Bank Capital Markets Strengthening our relationships with global Core Treasury & Risk software partners Strengthening our expert knowledge of the systems and applications of the regional Capital Markets Infrastructure Providers Developing Sophos-Branded SaaS solutions CoE TCM Where are we headed? - Focus on Mexico, Panama, Chile and North America; reach complete regional coverage - Consolidate our presence in the main financial groups in Colombia - Enter new client segments within the financial sector - Consolidate our Center of Excellence (CoE) for Core Banking applications - Strengthen our presence in the main Capital Markets players in Colombia; explore regional opportunities - Consolidate our Center of Excellence (CoE) for Treasury and Capital Markets applications Digital Developing partnerships with global or regional digital solutions partners (Open Legacy, others) Adopting and using on a permanent basis leading-edge technologies Developing Sophos-Branded digital solutions - Develop digital solutions and services, with emphasis on the financial sector - Establish our Center of Excellence (CoE) for new technologies Source: Sophos 42

43 Colombian Macroeconomic Ratios 4.3% 4.6% GDP Growth 6.8% Inflation (%) 5.8% 3.1% 2.0% 1.8% 2.7% 3.7% 4.1% 2.8% * Central Bank Repo Rate (%) 7.50% 5.75% 4.50% 4.75% 4.25% $ $ * FX Rate as of November : 3.240,02 YoY YTD MoM 7.8% 11.3% 0.9% FX Rate $ * *As of Sep 2018 **Central Bank Repo Rate as of September 2018 $ Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 43

44 Colombian Macroeconomic Ratios CAGR 13-17: 13 % AUM Pension Funds (COP Trillions) AUM Distribution (%) Foreign Equity Market 26% Cash and Derivatives 4% Local Fixed Income 46% * Foreign Fixed Income 7% Local Equity Market 18% Multi-fund Scheme since More than 14 Million affiliates. COLOMBIA RATING EVOLUTION MOODY'S S & P FITCH RATING DATE RATING DATE RATING DATE Ba1 (Positive) 9-Sep-10 BB+ (Positive) 7-Jul-10 BB+ (Stable) 21-Jun-07 Baa3 (Stable) 31-May-11 BBB- (Stable) 16-Mar-11 BB+ (Positive) 14-Oct-10 Baa3 (Positive) 8-Jul-13 BBB- (Positive) 15-Aug-12 BBB- (Stable) 6-Mar-13 Baa2 (Stable) 28-jul-14 BBB (Stable) 24-Apr-13 BBB (Stable) 10-Dec-13 Baa2 (Stable) 26-may-16 BBB (Negative) 16-feb-16 BBB (Stable) Jan-Aug-Nov 14 Baa2 (Stable) 29-jun-17 BBB (Negative) 18-jan-17 BBB (Stable) May-Dec 15 Baa2 (Stable) 31-oct-17 BBB - (Stable) 30-jan-18 BBB (Negative) 22-Jul-16 Baa2 (Negative) 22-feb-18 BBB (Stable) 10-Mar-17 BBB(Stable) BBB(Stable) Source: Colombian Financial Supervisor and Colombian Central Bank. * As of Sep 2018 & ** As of Oct Oct-17 9-May-18 Foreign Investment (USD Billions) LTM 2018** FDI Portfolio 44

45 Colombia Strategic investment opportunity Long & Stable Democratic Tradition 13 New Government - Aug 2018 Priorities: pro business & pro growth policies worldwide in strength of investor protection index becoming one of the safest environments for investment th since May 2018 reaching OECD Member standards of the developed world New Government Proposals New tax reform proposal to reduce corporate income taxes and balance with more VAT Pension reform to ensure sustainability and savings through capital markets Enhance trust and efficiency in the legal system with reform Renew momentum for large scale agricultural projects to diversify the economy and attract FDI Support for USD $20Bn 4G road construction program According to OECD Colombia has the lowest FDI barriers in LATAM Investment Grade since th Largest economy in LATAM with 49 million people and 7 cities with population over 1 million Strong & rapid growth of the middle class 16% (2002) 32% (2017) Remarkable reduction in poverty rates 50% (2002) 27% (2017) 45 Source: WFE, World Bank, OCDE, Colombian Central Bank, DANE

46 Disclaimer: The views expressed in this presentation not necessarily reflect the institutional view of the Colombian Stock Exchange (BVC for its acronym in Spanish). The information contained herein is only accurate as of the date thereof, may be updated, supplemented, amended or otherwise altered by subsequent presentations, reports and/or any communication made by the BVC. Since the information is subject to change the BVC will not necessarily inform you of such changes. This presentation may contain forward-looking statements that involve a number of risks and uncertainties or other factors beyond BVC s control that could cause actual results materially differ from those projected and do not guarantee any future BVC performance. These factors include, but are not limited to i. economic, political and market conditions and fluctuations; ii. changes in domestic and foreign regulation; and iii. adoption of government policies related to the securities markets. The financial statements contained in this document are for the period herein described and are provided for informational purposes. The BVC is not liable for the use that third parties give to the information contained herein. The most recent financial statements approved by the Board of the BVC are those published for the [II] quarter of BVC cautions the investor that the information set forth in this communication cannot be considered as sufficient in order to make investment decisions. 46