BloombergFixed Income

Issuance and TradingBALKAN REGION

Robert CutlerDebt Market Trading Products

r.cutler@bloomberg.net

Dubrovnik, Croatia12 May 2007

Multi-Dealer RFQ Firm Anonymous Orders Voice Trade Reporting No Transaction FeesMarket Activity Displays STP Features Counterparty Credit Logic Market Oversight Tools

BloombergBloombergBloomberg Overview

Primary Markets

Bloomberg Fixed Income

Trading Platform

Analytics

Secondary Markets

Bloomberg OverviewBloomberg Overview

Subscription base 245 000

Growth in Local Markets, 2006 35%

46% subscription base INCREASE in Croatia, for 2006

Fixed Income Volumes, 2006 – EMEA

Volume Market Share

Euro Govies 1225 bn 37%

Credits 348 bn 81%

IRS 1336 bn 79%

Primary MarketsPrimary MarketsBloomberg Bond Auction SystemBloomberg Bond Auction System

20 State Ministries/Treasuries use the Bond Auction System to

Auction their Government Bills or Bonds

Australia Belgium Czechoslovakia

Netherlands Finland Iceland

Ireland Israel CroatiaPortugal South Africa Slovenia

United Kingdom

Primary MarketsPrimary MarketsKey Benefits

EfficiencyTime to release results to market dramatically

reduced

Transparency

Robust Technology

Plug & Play, Easy Deployment

Free

Primary MarketsPrimary Markets

Auction result are

transmitted to dealers and

secondary markets

worldwide via the

Bloomberg’s secure private

network.

The Bloomberg Auction

System is used by central

banks, Ministries of Finance

and Corporate issuers

globally.

Users have complete

control over access and

allocation

Bloomberg’s Primary market Auction System automates all elements of the auction process. The system gathers and manages primary dealer bids and automated, instantanous allocation via the BLOOMBERG PROFESSIONAL service

Primary MarketsPrimary Markets

The Primary Dealer bids for

a new bond by simply

choosing the auction, then

entering on the bid entry

page.

The auctions are run in

Thousands (M),

millions (MM), and

Billions (B)

Primary MarketsPrimary Markets

Once the bid entry ticket

has been filled by the

Primary Dealer and the

auction has been closed,

the Ministry of Finance

will run their Algorithm

and the auction results

will be issues

Bid submission on behalf of participants

• Issuers can enter bids on behalf of participants should a participant have a technical problem. (optional)

– The bid appears in the participants BLOT. The trade detail shows how enter the bid for the participant.

New Bid Ticket

New Bid Ticket• Clearer layout – easier to use• Submit firm’s current position in security• Update all prices at in one go with a price change function• Display which clients participants are bidding on behalf of• Submit button to simplify the bid submission• Scroll bar if there are more bids than can be displayed on one page.• Per User Ticket – only displays bids the user has entered• Ticket entry error messages appear in pop-ups making their display

much clearer.

Bid parameters

• Per user limits

• User can setup up limits for – Size – Price

That get applied in the bid ticket. This gives the primary dealer a safety net when using an electronic system.

Separate client lists

• Issuers can now setup separate participant lists for individual tenders– Participants will only have access to bidding, be notified and receive banners for

auctions that are run in sectors they are enabled for.

Tender results summary

Fixed Income Electronic Fixed Income Electronic Trading PlatformTrading Platform

Key Asset ClassesGovernments, Credit, Convertibles, Swaps,

Credit Default Swaps, ECP, Repos,

Structured Products

Dealing MethodsClick & Deal

Request for Quote

Government BondsGovernment Bonds

Ability to view curve, see depth of market and click and deal

Government & Credit Bonds Government & Credit Bonds Click & DealClick & Deal

Government & Credit BondsGovernment & Credit BondsRequest for QuoteRequest for Quote

TRADE GOVT SWITCHES MRFQ UPTO 5 DEALERS IN COMPETITION FROM BBT<GO>

OR SST<GO>

BRANDING + PRICING

AnalyticsAnalytics

Runs Manager

Axes

Message Mining

AnalyticsAnalytics

Ability to see the depth of market in a bond

Click & Deal

RFQ

Analytics

Axes

Runs

Message Mining

BQ <GO>

EBND <GO>

• Key Benefits

1) UNIFICATION OF VARIOUS SOURCESOF LIQUIDITY

2) IMPROVED PRICE DISCOVERY3) EASIER AND MORE EFFICIENT

TRADE EXECUTION5) STP PROCESSING TO SETTLEMENT

AND CLEARING6) LOW OVERALL COST AND NO FEES

7) MORE EFFICIENT MARKET OVERSIGHT CAPACITY

Key Features

• All you need is your Bloomberg (no additional hardware or software required) •No additional charges/costs • Integration/connectivity available to other systems – ‘straight-through-processing’ of trades• Market information reporting available – e.g. SGSM<GO>• Ability to submit 2-way request-for-quote to dealers• Dealers have access/enablement controls for counterparties• Ability for aggressor to trade on all prices received back in any inquiry

• Ability to enter firm, anonymous orders (where enabled) as well as counterparty credit limits • Ability to handle more complex order types such as ‘iceberg’, ‘all-or-nothing’ etc• Ability to receive requests-for-quote when not quoting on a bond

EBND<GO>

EBND<GO>

• Benchmark bonds all listed down centre of screen

• Dealers can control who sees/can trade on their prices

• Depth of market from every available dealer available for each traded bond

• Simple controls – ‘point-and-click’, and red mouse buttons at top of screen for other options

• Note red ‘SUSPEND QUOTES’ button at the top of the screen – ‘Panic Button’ for dealers

EBND<GO>

• Click on a bid or offer price to launch a trade ticket

• 2 modes: ‘Order’, ‘Inquiry’• Inquiry: Select up to 5

dealers from list, send ‘RFQ’ – receive up to 5 prices back – trade

• Order: Anonymous or ‘name-giveup’ – click and trade on price. Live credit checking feature for counterparties trading anonymous orders

EBND<GO>• Dealer responds to inquiry

within same screen – Note new inquiry message in pink at bottom of screen

• Dealer can set alerts for bid/offer spread tolerance to warn of incorrect pricing – Note alert in red ‘spread tolerance exceeded’

• Dealer can see how many other dealers involved in competition for the request-for-quote – Note (2) in light blue strip at the top of inquiry response popup: this indicates 2 other dealers in competition

EBND<GO>

• Inquiry: Aggressor receives responses from dealers – clicks ‘SELL’, ‘BUY’, or ‘PASS’

• Aggressor may trade on as many as all 5 prices received back from dealers. Trade completed when all 5 prices either traded or passed – or when ‘FINISHED’ button at top of screen is clicked

EBND<GO>

• Dealer able to re-quote or suspend quote given to aggressor before his price is accepted – Note red ‘suspend’ button in dealer popup

EBND<GO>

• Example of aggressor’s price blotter showing dealer suspended quote during inquiry

EBND<GO>

• All trade details are recorded automatically

• Trade details can be passed automatically to other internal/settlement systems on completion of a trade (‘Straight-through- processing’)

EBND<GO>

• Automatic logging of entire trade negotiation – Bloomberg ‘Transaction History’ screen

EBND<GO>

• Counterparty credit limit management tools to allow a dealer to create limits for anonymous order trading for each counterparty

EBND<GO>

• Data from trading on the EBND platform can be provided to the market – Here we see intraday volumes and trading statistics for each bond traded on the Singapore EBND platform. This aids market transparency and development

What is Bloomberg’s Goal?What is Bloomberg’s Goal?

Central place for all market liquidity

Benchmark system for all market data

in established and local markets

Facilitate efficiency and transparency

in local markets

Make Bloomberg the preferred solution

in Primary & Secondary Bond Markets

Contacts:

• Robert Cutler - +44 20 7330 7494

• Ebru Boysan - +44 20 7330 7691

• Bloomberg Help Desk

• Bloomberg Electronic Trading Team:+44 20 7330 7476