“Investment Opportunities in Jordan Seminar”
Under the patronage of his Majesty King Abdullah II Bin AlHussein, the Amman Stock Exchange represented by Mr. Jalil Tarif the Chief Executive Officer, participated in the Seminar “The Investment Opportunities in Jordan”, organized by the Jordan Investment Board and in cooperation with the Arab British Chamber of Commerce, which was held in London on November 6th, 2006. Mr. Tarif presented briefly the recent developments of the ASE and the great leap growth in the trading and foreign investment volume, and the protection provided by the Jordan capital market for the foreign investors.
ASE Re-Elected as Chairman of the Working Committee of FEAS
The Amman Stock Exchange (ASE) was re-elected unanimously for a second term of two years as the chairman of the Working Committee of the Federation of Euro-Asia Stock Exchanges (FEAS) during the FEAS 12 th Annual General Assembly Meeting held in Cairo/ Sharm El Sheikh, Egypt on November 1-4, 2006. Mr. Nader Azar the Deputy CEO, and Mr. Sami Hattab the head of the Research and International Relations Department represented the ASE at the meeting. This election of the ASE came as a result of the confidence, contribution, and achievement of the ASE towards FEAS and its members. Mr. Azar chaired the meeting of FEAS Working Committee (WC) which comprised of 28 members from central and south east Asia as well as the Middle East countries. During the WC meeting several issues were discussed, most importantly the reports of task forces, the development of the index for the Federation region, FEAS work plan for the next year, revenue expense analysis, 2007 draft budget proposal, 2006-2007 calendar of events, the FEAS semi-annual report, the bilateral training program and the schedule of exchange visits among FEAS members. Alongside the Working Committee meeting, a Media Gathering was held in which two main issued were discussed: the first was the history and the role of FEAS in the region and its future outlook which presented by Mr. Azar, and the correction that had taken place in the Arab stock exchange which presented by Mr. Maged Shawky, Chairman of the Cairo and Alexandria Stock Exchanges. The ASE also participated in the meeting of the FEAS executive committee and as a member was re-elected in the executive committee which made up of 12 members. During the meeting Egypt was elected as vice resident of the FEAS. At the General Assembly, two new membership applications of Belarusian currency Stock Exchange and Iran Central Security Depository were approved, bringing the total number of FEAS members to 32 with 9 Affiliate members, the GA also approved the Federation 2005 financial statements and the estimated 2006revenues and expenses of the Federation. The GA approved the recommendations of the Federation Working and Executive committees. The 13 th General Assembly of FEAS in 2007 will be hosted by Belgrade Stock Exchange in Belgrade, Serbia. Jordan was one of the founding members of FEAS in 1995, and has assumed the position of a vice president for several years. At present, FEAS counts some 32 financial markets from Europe and Asia amongst its membership, with market capitalization of more than $696 billion. Some of the important member markets in the region are Turkey, Pakistan, Iran, and several European markets. The Arab member markets in the Federation are Jordan, Egypt, Oman, Abu Dhabi, Bahrain and Palestine.
Corporate Governance In the MENA Region
The ASE, represented by Mr. Moayyad Tahtamoni chief of listing division from Listing and Operations Department and Mrs. Abla Khdeer chief of Public Relations division from Awareness and Public Relation Department participated in the “Corporate Governance in the Middle East and North Africa Conference” which was held in Dubai, UAE during the period November 26-27, 2006 ? which was organized by Hawkamah, the Institute for Corporate Governance and Organization for Economic Cooperation and Development (OECD). During the conference a variety of issues were discussed, with a special concern on corporate governance in the financial sector, enhancing corporate governance among listed companies, and the role of banking system in enhancing corporate governance.
A Syrian delegation visits the Capital Market Institutions
A delegation from the Higher Institute of Business Administration visited the Capital Market Institutions, where the delegation was briefed by Mr. Nader Azer the Deputy to CEO of ASE on the latest development on the national capital market. The delegation visited the financial brokerage companies and toured the ASE facilities and the Investor's Gallery.
Gitex 2006 Exhibition
The ASE, represented by Mr. Mohammed Al-Shajrawi Chief of Operations and Technical Support Division from the IT and Communication Department participated in Gitex 2006 Exhibition which was held in Dubai UAE during the period November 19-23, 2006, which is considered to be one of the biggest telecommunications and technology exhibitions in the Middle East.
Malaysian Mutual Fund and Dual Listing Experience
The ASE, represented by Mr. Bassam Abu Abas, Head of Listing and Operations Department joined capital market institutions in a delegation to Malaysian Commission to the Malaysian Bourse during the period November 21-23, 2006. The delegation had a look on the Malaysian mutual fund and dual listing experience, which is considered one of the successful experiences.
Annual Meeting For World Federation Exchanges (WFE)
H. E. Mr. Mohammed S. Hourani, Chairman of the Board and Mr. Jalil Tarif the ASE CEO represented the ASE in the Annual Meeting for World Federation Exchanges (WFE), which was held in Sawbaelo- Brazil during the period 15-17/10/2006.
The Third Quarterly Report 2006
By virtue of the ASE Listing Directives, all companies listed at the First Market must submit reviewed quarterly reports during the first month that follows the said quarter. Such a step shall increase transparency and disclosure in the Jordanian capital market, by providing information to investors on companies' performance, which helps investors in making their investment decisions. The ASE received the quarterly reports prepared by the companies listed at the First Market. By the deadline; the number of companies that submitted their reviewed reports were (91) out of (96), representing (95.7%) of the overall companies listed on the First Market. Five companies did not submit their reports within the time limit, in breach of Article 15(b) of the ASE Listing Directives; The Jordan Insurance Company submitted an unreviewed quarterly reports within the time limit, however Arabian Seas Insurance Company, Holy Land Insurance Company, Jordan Phosphate Mines Company and El-Zay Ready Wear Manufacturing company did not submit their reports. The ASE shall be imposing penalties on these companies. The ASE circulated the received quarterly reports to all its members through Intranet to enable them to inform their clients thereof. Copies of said reports were also posted on the ASE website (Arabic version) 126.96.36.199 in the Circulars and Disclosures / quarterly reports window.
Libyan Securities Market Visits ASE
H. E. Chairman of the Board and the CEO of the ASE received a delegation from Libyan Securities Market (LSM) headed by Mr. Suleiman Shoumi the Chairman Board of Directors during the delegation visit to the Jordanian Capital Market Institutions. The delegation had brief on the nature work of the ASE and the latest developments on the Jordan Capital Market. The delegation visited the Financial Brokerage Companies and toured the ASE facilities and Investor's Gallery. During the meeting Mr. Tarif and Mr. Shoumi discussed means of strengthening cooperation between the ASE and LSM.
International Organization of Securities Commissions Emerging Market Annual Meeting
H. E. Mr. Mohammad S. Hourani, Chairman of the Board represented the ASE in the International Organization of Securities Commissions (IOSCO) Emerging Market annual meeting that was organized by the International Organization of Securities Commissions (IOSCO) with cooperation from China Securities Regulatory Commission (CSRC) which was held in Shanghai /Republic of China for the period 18 - 22 September, 20065.
Expert Group Meeting on the Role of Capital Markets in the Economic Development
Mr. Jalil Tarif the ASE CEO participated in the Expert Group Meeting on the Role of Capital Markets in the Economic Development that was organized by the United Nation Economic & Social for West Asia (ESCWA) which was held in Abu Dhabi during the period 19-20/9/2006. The meeting provided an important venue for regional experts, government officials, and private sector to identify the challenges and solutions for mobilizing the regional capital markets by presenting practical means to enhance the role of capital markets economic development in ESWA member countries. Papers from different Arab exchanges has been presenting including Jordan.
IMF Study on the Feasibility of Investing in the ASE
The International Monetary Fund (IMF) recently published a research paper entitled “The Feasibility of Investing in the Amman Stock Exchange: investing in it for risk diversification or performance?” in which the study analyzed the performance of the ASE and the extent of its Co integration with some Arab, emerging and developed market.
The study has some implications for international portfolio diversification overall, the results suggested that investing in several Arab stock markets may offer a limited opportunity for further long-term risk diversification. Investors desiring to diversify their portfolios in developed and other non-Arab emerging stock markets may be able to achieve additional diversification by investing in the ASE. The ASE compares favorably with many other Arab markets in terms of investment restrictions, transparency, and the regulatory environment, and has had relatively low price volatility. The study also showed that the Jordanian market is granger-caused by markets in Saudi Arabia and Kuwait. Thus, outside investors could get indirect exposure Arab stock markets by investing in Jordan.
The study also shows that the average weekly return for the ASE is 0.43%, which is high compared with other countries except Saudi market has 0.53%. However in term of risk Jordan's average standard deviation of returns 2.52 is close to average of other Arab markets and developed markets but lower than the average of emerging markets with the exception of the Saudi market, where the risk average reached 2.42%. And comparing the ASE with other markets through Sharp Ratio, which measures the returns comparable with the risks, the study found the rate to be 0.17 for the ASE, 0.12 for Kuwait, 0.01 for Oman, 0.09 for Egypt, 0.02 for Lebanon, 0.08 for Tunis, 0.01 for Morocco, with the exception of Saudi Arabia, which reached 0.22.
The study refers to the strong performance of the ASE over the past few years likely had positive effect on the macro economy. The standard transmission channels from the stock market to the real economy are though the wealth effect, savings and investments generation, improved intermediation and effects on expectations. With the increase wealth in stocks, investors increase their consumption, which tend to increase domestic demand. Similarly with stock prices increase, more companies go public and raise money for investment though public offering, which is the case of Jordan. Moreover, the good stock market performance attracted capital to Jordan, which helped finance to become somewhat lower.
Mr. Jalil Tarif, the CEO of the ASE, received the International Monetary Fund ) IMF ( delegation that visited Jordan. During the meeting with the delegation, Mr. Tarif presented the latest developments at the legislative, technical and quantitative levels and its impact on enhancing market transparency, liquidity and efficiency. Mr. Tarif asserted that the ASE had achieved remarkable performance during recent years, resulting in an increase in revenues, in trading volume as well as in market capitalization that exceeded US $ (32) billion in the year 2006 that represents (270%) of the GDP.
Cairo & Alexandria Stock Exchanges chairman Visits ASE
Mr. Jalil Tarif the ASE CEO received the Chairman Cairo & Alexandria Stock exchange Mr. Maged Shawky. Mr. Tarif briefed the Mr. Shawky on the nature work of the ASE and the latest developments on the Jordan Capital Market . During the meeting they discussed means of strengthening cooperation between the ASE and CASE.
Student Delegations visits the ASE
Mr. Nader Azar the deputy CEO of the ASE received a delegations From the Syrian National Institute of Public Administration and a delegation from Applied science University in Jordan . Mr. Amjad Al-Qudah , head of Awareness and Public Relations Department briefed the delegations on the nature work of the ASE and the latest legislative and technical developments on the Jordan Capital Market. The delegation toured the ASE facilities and Investor's Gallery.
Public Shareholding Companies' Performance, First Half 2006
Financial data of (197) companies, which reported to the ASE via their semi-annual reports, indicate a (10.3%) total assets growth as compared to the previous year, reaching to JD (40.1) billion; the shareholders equity increased by (25.6%), reaching JD (9) billion. Pre-tax income for all sectors decreased by (29.8%) to reach JD (577.7) million compared to JD (822.7) million for the year 2005. At the sector level, the pre-tax income increased for the banking sector from JD (351.9) million in 2005 to JD (390.3) million in 2006, an increase of (10.9%), as for other sectors pre-tax income decreased, the insurance sector decreased by (90.1%) from JD (47.5) million in 2005 to JD (4.7) million in 2006, the service sector decreased by (71.4%) from JD (278) million in 2005 to JD (79.5) million in 2006, and the industry sector decreased by (35.1%) from JD (145.3) million in 2005 to JD (94.3) million in 2006.
Bilateral Exchange Program with Istanbul Stock Exchange
As part of efforts to enhance bilateral cooperation among the Federation of European Asian Stock Exchanges (FEAS) member stock exchanges, the FEAS held a number of bilateral cooperation programs and visits among the member stock exchanges. In this framework, a delegation from the ASE, represented by Mrs. Suzan Kashoqa, Head of the Statistics and Publication Division of the Research and International Relations Department, and Eng. Bilal Nuwairan from the IT and Communication Department, visited the Istanbul Stock Exchange. During this visit, the delegation was briefed on issues related to the work of the statistics department, market operations, members, listing and monitoring and information technology.
The Annual Meeting of the Arab Financial Forum (AFF)
Mr. Jalil Tarif the ASE CEO participated in the annual and roundtable meeting of the Arab Financial Forum (AFF) that was organized by the Organization for Economic Co-operation and Development (OECD) in London during the period 24-25/7/2006. The meeting highlighted the latest capital markets developments in the Gulf, Middle East and North Africa and reviewed the OECD's efforts to enhance the principles of transparency, disclosure and corporate governance in the region. Participants stressed on the importance of providing awareness and educational programs for various parts of society to strengthen basic concepts of financial markets and the importance of these markets in increasing savings, investments and economic development.
Palestine Securities Exchange CEO Visits ASE
Mr. Jalil Tarif the ASE CEO and his deputy Mr. Nader Azar received Chairman and CEO of the Palestine Securities Exchange (PSE) Dr. Hasan Abu-Libdeh who visited the ASE and Jordanian Capital Market Institutions end of July 2006. During the meeting they discussed means of strengthening cooperation between the ASE and PSE, particularly in exchanging information, training and increasing the cooperation in all fields related to the two markets.
New Sectoral Classification and New Index for the ASE
As part of the Amman Stock Exchange (ASE) policy for upgrading and developing its services to interested parties in the market, the ASE has recently introduced a new sectoral classification for companies listed at the stock exchange. The classification is in line with international standards and provides a clearer picture about listed companies in order to help investors make their investment decisions. The ASE also constructed a new index that is based on free float shares, which provides a better representation of the shares' prices movement in the market without bias to large cap companies, thus limiting their impact on the index.
In order to apply this classification on listed companies, the ASE had studied the international standards applicable in this field, as well as the sectoral classification adopted by some Arab and international stock markets, after which the classification used by the S&P's was adopted with some minor modifications that render them suitable for the nature of Jordanian companies.
Pursuant to this classification, listed companies are classified in three major sectors: the financial sector that includes banks, insurance, financial services, real estate and investment companies; the services sector that includes companies operating in the field of health care sector, education, energy, transportation, tourism and communications; and the industrial sector that includes companies operating in the field of mining and extraction industries, engineering and construction, food and beverages, tobacco, textiles, leather and clothing, ceramics and electrical industries. These three major sectors are also divided into (23) sub-sectors, whereby companies that have the same operations and activities are placed in the same group.
This classification has many advantages. It helps show the nature and objectives of the companies more clearly and more accurately to investors, which will in turn facilitate the analysis of the company's financial statements and comparing it to companies of the such and with the sector it belongs to. Moreover, investors will be able to follow the changes in shares prices of the various sectors using the indices that the ASE has calculated for each major sector and sub-sector.
The ASE developed a new index based on the free float shares, whereby the index is calculated using the market value of the free float shares of the companies and not the total number of listed shares of each company. This method is notably used by many international institutions that calculate the indices for most of world countries and that are considered leading international companies in the area of indices-related services, such as S&P's, FTSE Group, Dow Jones and STOXX.
The methodology of Dow Jones and STOXX were applied in selecting the index sample, which consists of the companies according to which the index is calculated. When selecting the companies, it is taken into account that the companies selected for the sample are actively traded, thus companies whose shares are not traded for over ten consecutive days are excluded, as well as the companies whose trading is suspended. After that, companies are selected for this index based on three criteria: the company's market value accounts for 60% of the company's overall rank, the pre-tax income accounts for 20% of the overall rank, and the revenue / sales accounts for 20% of the overall rank. Each company is given a rank on each criterion, so that each rank is multiplied by the weight of each criterion, thus calculating the overall rank of the company. The top seventy companies are then selected, and the index sample is reviewed two times a year. Moreover, a cap of 10% has been set for the weight of any company at this index, whereby this weight is lowered during the semi-annual review of the index sample.
This index is characterized by the fact that it reflects the shares prices movement in the market in a better way, and it is not biased to large market value companies. In addition, it provides small and medium cap companies a greater opportunity to influence the movements of the index. It is also noteworthy that this index could be used in the construction of financial derivatives.
The ASE also calculated sectoral indices for the three major sectors, which are: the financial sector, the services sector, and the industrial sector. Also, indices were calculated for all the sub-sectors. Most companies listed in the sectors have already been selected for calculating these indices, and all these indices were calculated on the basis of the free float shares.
This index was given the base value of 1000 points as of the closing of the year 1999 and was calculated on a daily basis for the period 2000-2006. It is to be mentioned that the performance of this index was found consistent with the performance of the other indices calculated by the ASE. Moreover, the sectoral indices were given the base value of 1000 points as of the closing of the year 1999 and were calculated on a daily basis for the period 2000-2006.
It is worth mentioning that the ASE will keep the current price indexes and sector classification. The new index (weighted by free float shares) will replace the current one, which is disseminated on-line through the trading system, as soon as the ASE assured that the market participants are acquainted with the new index.
The Annual Conference of the International Organization of Securities Commissions (IOSCO)
The ASE joined capital market institutions in a delegation led by Mr. Mohammad Saleh Al-Horani, Chairman f the ASE Board, Mr. Jalil Tarif, The CEO, Mr. Sami Hattab, Director of the Research and International Relations Department, and Mr. Amjad Al-Qudah, Director of the Awareness and Public Relations Department, at the annual conference of the IOSCO that was held in Hong Kong, June 5-8, 2006.
During the Conference, Dr. Bassam Saket, JSC, Executive Chairman was elected as a member of the IOSCO Executive Committee, which is comprised of 14 members representing the Securities Commissions in advanced and emerging countries. He was also elected as a Vice Chairman of the IOSCO Emerging Markets Committee. The ASE CEO chaired the meeting of the Self-Regulatory Organizations (SRO) sub-committee supervising the SRO website that discussed a number of proposals for developing the Committee's website. Capital market institutions also introduced participants to the recent developments at the Jordanian capital market, and participants commended the advanced level achieved by the Jordanian capital market institutions.
American Pension Funds Express Interest in Investing at the ASE
The ASE, represented by Mr. Jalil Tarif, The ASE CEO, participated in a meeting with senior executive officials of the American Pension Funds in Aqaba on 22 June 2006. The American Pension Funds expressed their interest in investing in the ASE following wide-scale developments to the investment climate on the Capital Jordan Market. Mr. Tarif said that these Funds, which manage one of the largest financial portfolios in the world, have expressed admiration for and commended the level of advancement of the Jordanian capital market, which ranks high among its emerging counterparts, particularly in the areas of disclosure and corporate governance, as well as the continuous development of market-regulating legislations. Mr. Tarif further stressed the significance of the Funds' visit to the Kingdom due to their large investments throughout the world, and pointed out that their visit was an opportunity for them to learn about the latest developments in the capital market. He said that these Funds know beforehand the status of the Jordanian market compared to other emerging markets in the world. During their visit, they received, firsthand, an introduction to the benefits of investing in Jordanian companies, the attractiveness of the investing in Jordan in light of the Kingdom's economic openness, and the ease of capital transfer, as well as the political and security stability of the country.
Mr. Tarif indicated that international standards, including the evaluation of international pension funds like ‘CalPers ', showed that the ASE is one of the most significant emerging markets. According to statistics issued by the Securities Depository Center SDC, American investments rank number eight of the total nationalities investing in public shareholding companies, with 1600 shareholders owning the value of JD400 million.
Detection and Prosecution of Securities Market Abuses Conference
The ASE, Represented by Mr. Tariq Abu al-Hyja from the Surveillance and Inspection Department Participated in the Detection and Prosecution of Securities Market Abuses Which was held in Manama Bahrain from June 26-28,2006. The meeting addressed several issues including the market surveillance, development, operation and regulation of Securities market.
27th Annual Meeting of the Union of Arab Stock Exchanges
H. E. Mr. Mohammad S. Hourani, Chairman of the Board, and Mr. Jalil Tarif, the CEO, represented the ASE in the 27 th Meeting of the Union of Arab Stock Exchanges, which was held in Beirut for the period 20 - 22 May, 2006. The participants discussed the Secretary-General's report on the Unified Arab Stock Exchange and recent related developments. They also discussed the latest developments pertaining to Arab financial markets, the Union's Financial Report for the years2003, 2004 and 2005, as well as the estimated general budget for 2006. Mr. Tarif chaired the working session that discussed the major changes in the international standards in Financial Reporting and their impact on Arab markets, specifically those standards related to the evaluation of investment and their impact on listed share prices and on capital markets in general.
FEAS Working Committees Meeting
Mr. Nader Azar the Deputy CEO of the ASE chaired the meetings of the Federation of Euro-Asian Stock Exchanges (FEAS) working committee that was held in Moldova for the period May 16-17, 2006. Mr. Waseem Haddad from the Research and International Relations Department also attended the meeting. During the meetings, the proposed agreement between the FEAS and DOW JONES to calculate an index for the FEAS and the membership applications submitted by various stock exchanges, including Qatar, Bella Russia and Dubai, as well as the training and the bilateral exchange program for FEAS member stock exchanges were discussed. Mr. Azar emphasized the need for best employment of allocations for training and exchanges, as this will have positive influence on FEAS members. The importance of the role of the media and the preparation of qualified media personnel in the field of stock exchanges was also discussed and a variety of proposals and suggestions were presented on this topic. The meetings also discussed the importance of having specialized common systems for presenting the financial data of companies listed at the financial markets and the significance of this issue in enhancing transparency and facilitating the analysis of the data by investors. As a result, a working group that includes Jordan was formed to follow up on this issue, develop it and then publicize it to FEAS members. Finally, the meetings discussed the FEAS financial report and statements for the year 2005.
The first quarterly report 2006 ?
By virtue of the ASE Listing Directives, all companies listed at the First Market must submit reviewed quarterly reports during the first month follows the said quarter. Such a step, shall increase transparency and disclosure in the Jordanian capital market, by providing information to investors on companies' performance which help investors in making their investment decisions.
The ASE received the first quarterly reports prepared by the companies listed at the First Market. By the deadline; the number of companies that submitted their reviewed reports were (91), representing (95.7%) of the overall companies listed on the First Market. Four companies did not submit their reports within the time limit, in breach of Article 15(b) of the ASE Listing Directives; Jordan Commercial Bank and Capital Bank of Jordan submitted an un-reviewed quarterly reports within the time limit, however United Arab Investors company and Jordan phosphate Mines did not submit their reports. The ASE shall be imposing penalties on these companies.
New Version of the Electronic Trading System (NSC V2+)
The ASE has activated the new version of the electronic trading system (NSC V2+), which comes as part of efforts to meet the increasing needs of the Jordanian Capital Market and in order to raise the capacity of the current electronic trading system to accommodate the increase in the daily trading volume, as well as the ASE's policy of preserving the safety of securities trading and safeguarding an equal treatment of those dealing in securities.
The new version of the electronic trading system will provide a number of privileges, namely the ability to operate modern servers that are capable to accommodate the market's increased activity in an efficient manner, and the use of the latest versions of databases, in addition to that the new version has added features of activating a set of trading rules.
The new version also will enable the ASE to implement a set of procedures related to the trading mechanism, and that is by canceling the Open Price Order, canceling the Forced Cross and the Cross Order on best prices, as well as modifying the method of calculating the ASE's general index in terms of nullifying the potential influence of Indicative Equilibrium Prices (IEP) or the Theoretical Opening Price (TOP) outside permitted limits for companies in the ASE general price index.
The ASE has started to implement the electronic trading system since 2000 and has allowed remote trading, as these companies were connected with the ASE servers using the fiber optics network and leased lines. There are currently (55) brokerage companies working at the ASE.
Awareness Lectures About Capital Market
To enhance relations and continuous intercommunication with the local community, and in conformity with the Amman Stock Exchange policy of propagating the culture of investment and increase awareness among citizens and securities' dealers, ASE held a string of daily educational lectures about the fundamentals of stock market and the functions of capital market institutions in Jordan. This program aims at elevating the awareness of dealers and those individuals interested in the market. Number of participants in this program exceeded (500) in each program.
Student Delegations visits the ASE
Student Delegations from Al-Hussein Bin Talal University and Irbid University visited the ASE. Mr. ? Amjad Al-Qudah, Head of Awareness and Public Relations Department received a delegations and briefed them about the nature work of the ASE and the latest developments in the Jordanian capital market.
The Annual U.S. Securities and Exchange Commission's Meeting
The ASE, Represented by Mr. Yousef Al-Tal from Legal Department participated in the U.S. Securities and Exchange Commission's annual International Institute for Securities Market Development which was held in Washington D.C from April 17-27,2006. The meeting addressed several issues including the market development, operation and regulation of securities markets.
ASE General Assembly 7 th Meeting
On March 9, 2006 the ASE held its Seventh General Assembly meeting which was chaired by H.E. Mr. Mohammad Saleh Al-Hournai, Chairman of the ASE Board of Directors and was attended by Mr. Jalil Tarif, ASE CEO, and Dr. Abdel Razzaq Bani Hani, JSC representative. During the meeting, the Board of Directors' report on ASE's accomplishments, activities and future plans was discussed. Furthermore, the report of the ASE auditor was presented and the financial statements of the year ending on December 31, 2005 were endorsed.
Amman Stock Exchange Signs Two Dual listing Agreements with Dubai Financial Market and Abu Dhabi Securities Market
The Amman Stock Exchnage (ASE) signed two agreements with Dubai Financial Market (DFM) and Abu Dhabi Securities Market (ADSM) regarding dual listings for securities in both countries. The agreements were signed by Mr. Jalil Tarif, the CEO, of the Amman Stock Exchange, and by Mr. Issa Kathem, the General Manager of the Dubai Financial Market, and Mr. Rashed Al-Beloushi, the acting CEO of the Abu Dhabi Securities Market.
The signing of two agreements is part of the ASE's endeavors to enhance joint cooperation with the two markets in order to serve the interests of people dealing in securities in the two countries. The agreements aim to facilitate the process of dual listing of shares of companies that are listed at the ASE and that wish to have their shares listed at the UAE market, and the same for companies that are listed in the two UAE markets and that wish to list their shares at the ASE. These agreements are designed to strengthen investment opportunities available to investors on one hand, and support the depth of the securities markets in both countries on the other.
The Jordan Securities Commission (JSC) also signed Memorandum Of Understanding (MOU) with the UAE Securities and Commodities Commission. The signed memorandum focused on the exchange of expertise and information in a manner that contributes to developing the performance of the securities commissions in both countries, as well as to improving the legislative framework. The Securities depository Center also signed two agreements with Abu Dhabi Securities Market and Dubai Financial Market to regulate, maintain and transfer the ownership of traded securities.
“Banking, Insurance, Technologies & Exchange Exhibition” BINTEX ‘06
The ASE participated in the BINTEX 2006 that was held in Damascus on March 13-14, 2006, represented by Mr. Nidal Hamdan, Director of the Administrative and Financial Department. The ASE participation falls within its endeavors to have continuous and strong presence in relevant international arenas.
Lecture on Derivatives Markets
As part of the joint cooperation between the Amman Stock Exchange, the Athens Stock Exchange and the Salonek Stock Exchange, Mr. Nicos Porfiris, an expert on derivatives markets from the Salonek Stock Exchange, gave a lecture on the Greek derivatives markets and the ways that the Jordanian Capital Market could benefit from it. Officials and employees from the JSC, the ASE and the JDC, as well as representatives from financial service companies, participated in the meeting.
Amending the provisions of Article (11) of Listing Directives
The ASE applied the provisions of the Listing Securities Directives after amending the provision of Article (11), in which company listed on the ASE shall apply for listing its Capital-increase shares within five working days from the completion of issuance procedures. This amendment, which was endorsed by the ASE Board of Directors and the JSC Board of Commissioners, is in line with the policy of the capital market institutions to enhance the investment climate in Jordan and to provide the opportunity for investors to start trading in the new issued securities as quickly as possible, once listed application is filed and the company completes all the necessary procedures at the ASE. The ASE had previously started applying the current listing Directives since the beginning of July 2004, which included an important changes to the listing conditions, most significant of which is committing companies listed at the First Market to submit quarterly reports revised by their auditors. In addition, the ASE had amended Article (5) of the Securities Listing Directives last year with the purpose of facilitating procedures of issuers who want to list their shares at the ASE.
The 16th International Conference on Funding Small and Medium Enterprises
Mr. Jalil Tarif, the CEO of the ASE, chaired the 4th working session of the 16th International Conference on Funding Small and Medium Enterprises/ Future Steps that was held at CPA Association in Lebanon in cooperation with the World Bank and the Higher Council for International Accounting Standards (IASB). Mr. Tarif presented Jordan's experience in the field of capital market development and the legislative, technical and quantitative changes that occurred recently at the ASE. Mr. Tarif said that the current Companies Law has allowed for the establishment of private shareholding companies that can list their securities at the ASE and granted these companies numerous privileges related to minimum capital requirements and the various securities they could issue and issuance conditions, in addition to other privileges. Consequently, statistics show that (139) private shareholding companies have been established since the enactment of the Companies Law with total registered capital of JD (1.15) billion.
Participation in the Corporate Governance Conference
Mr. Nader Azar, the Deputy CEO, and Mr. Moayyad Tahtamouni from Listing and Operation Department represented the ASE in a conference about Corporate Governance that was held in Istanbul, Turkey during the period 15-16 February 2006. During the conference, which was organized by Organization for Economic Cooperation and Development (OECD) and the Federation of European Asian Stock Exchanges (FEAS), a variety of issues were discussed, with a special concern on Corporate Governance in the financial sector. On the sidelines of the conference, participating organizations met to discuss cooperation between them in the future.
Training Course for Financial Brokers
The ASE has organized two training courses for financial brokers during cooperation with capital market institutions, with the participation of around 70 trainees from the licensed brokerage companies. These courses aim to provide the necessary qualified human resources in view of the Jordanian capital market's need for raising the number of financial brokers due to the noticeable increase of the number of people dealing in securities and of the trading volumes. During these courses, participants are introduced to the basic concepts and skills related to dealing in securities as well as the tasks and duties of each of the Jordan Securities Commission, the Amman Stock Exchange and the Securities Depository Center. Additionally, practical training courses are provided on the electronic dealing system that is used by the ASE and the systems of the Securities Depository Center. Successful completion of this course is considered one of the requirements for obtaining the license to practice the profession of brokerage for practitioners of financial professions.
Mr. Jalil Tarif, the CEO of the ASE, received the International Monetary Fund ) IMF ( delegation that visited Jordan. During the meeting with the delegation, Mr. Tarif presented the latest developments at the legislative, technical and quantitative levels and its impact on enhancing market transparency, liquidity and efficiency. Mr. Tarif asserted that the ASE had achieved remarkable performance during recent years, resulting in an increase in revenues, in trading volume as well as in market capitalization that exceeded JD (26) billion in the year 2005 that represents (327%) of the GDP.
NSC-Unix Users Annual Group Meeting
Mr. Jalil Tarif, Chief Executive Officer, chaired the NSC-Unix Users Annual Group Meeting that was held in Paris during the period 24-25 January 2006. During the meeting the participants discussed latest administrative developments related to new trading system, which is called (V900) that Atos Euro Next Market Solution company (AEMS) is developing. The meeting was attended by Mr. Mohammed Al-Khatib, Director IT & Communications Department, Mr. Bassam Abu Abbas, Director Listing & Operations Department and Mr. Adel Abu Assaf from IT & Communications Department .
Signing a Broadcasting Agreement with Bloomberg
The Amman Stock Exchange (ASE) signed an agreement with Bloomberg the international data provider company. According to this agreement Bloomberg will broadcast live the ASE trading information through its networks around the world.
Mr. Jalil Tarif, the ASE CEO, said that providing this service is designed to enhance principles of disclosure and transparency in the Jordanian capital market, to provide a fair and competent market for securities, and to fulfill the needs and requirements of Arab and foreign investors and other parties concerned with the Jordanian capital market. This service will contribute to enhance investments in Jordanian securities, especially since it will provide detailed online and historical trading data for traded securities.
The ASE has, since its establishment, gives special attention to data dissemination using all available means in order to enable local and foreign investors to follow up online trading, thus achieving fairness amongst all investors. During the past year, five major agreements related to data disseminations were signed, whereby these companies broadcast live trading information using the Internet, the Short Messaging Service (SMS) on mobile phones and various computer software.
This agreement will help broadcast on-line information to all Bloomberg subscribers that include leading companies in the field of financial and banking services in the world.
Bloomberg is a company that was established in 1981 as an international company specialized in broadcasting news and information. Based in the city of New York, Bloomberg provides its services in over 126 countries through 110 offices located around the world and with a working cadre of over 8200 employees.
First Investment & Capital Markets Conference
H.E. Mr. Mohammad S. Al-Hourani, ASE Board Chairman, and Mr. Jalil Tarif, ASE Chief Executive Officer represented the ASE in the first Investment and Capital Markets Conference that was held in Damascus/ Syria during the period 6-7 December 2005. Mr. Tarif delivered a presentation on the latest legislation and technical developments on the Jordan Capital Market in recent years.
The Role of Financial Markets in Economic Development
Mr. Jalil Tarif, ASE CEO, participated in the seminar that was held in Tripoli, Libya, on the Role of Financial Markets in the Development process. The seminar, which was organized by the General People' Committee (GPC) for Libyan Economy and Trade, was attended by a number of government officials and several people interested in this field. Mr. Tarif presented a working paper entitled “The Role of Financial Markets in Economic Development (Experiences & Future Perspectives)”. The seminar also addressed several issues including the foundations for establishing a securities market in Libya, and the role of the market in activating programs for expanding the ownership base (privatization).
On the sidelines of the seminar, the ASE CEO and officials from Financial Markets in Egypt and Tunis met with the Secretary General of the GPC. During the meeting, they discussed the possibility of providing the necessary expertise for establishing a Securities Market in Libya and preparing the necessary legislative, technical and training climate for that, particularly since the ASE had contributed in establishing many Arab financial markets.
Participation in the 9th Arab Business Community Forum
The Amman Stock Exchange (ASE), represented by H.E. Mr. Mohammad S. Al-Horani, ASE Board Chairman, and Mr. Jalil Tarif, ASE CEO, participated in the 9th Arab Business Community forum that was organized by the Arab Businessmen Federation in Qatar/Doha on December 13-14, 2005. Mr. Tarif presented a working paper on the status of the Arab sock markets and the challengers they face. Also he pointed out the latest developments in securities industries especially changing the legal status of the exchanges (Demutualization) and to be a profit making exchanges.