Dubai Financial Market

Investor PresentationQTR 3, 2013

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iCONTENTS

MENASA Region : Macroeconomics ………………………. 1

Dubai : Middle East’s Financial Hub ………………………. 5

UAE Capital Markets : DFM / ND / ADX ………………………. 9

Two Exchanges, One Market : DFM & ND …………………….... 14

Corporate Strategy : Going Forward …………………….... 24

THE REGION – MENASA / GCC/ UAE

AN ECONOMIC POWERHOUSE

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2006 2007 2008 2009 2010 2011 2012 2013 f

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

0

1,000,000,000,000

2,000,000,000,000

3,000,000,000,000

4,000,000,000,000

5,000,000,000,000

6,000,000,000,000

7,000,000,000,000

8,000,000,000,000

GDP Growth (%)

2

Iran

GDP 2012 (USD Millions)

7% of global GDP

MENASA REGION :SOLID ECONOMIC FUNDAMENTALS-PROMISING GROWTH

Source: IMF, World Bank

2006 2007 2008 2009 2010 2011 2012 2013 f

1.4%

1.6%

1.8%

1,750,000,000

1,800,000,000

1,850,000,000

1,900,000,000

1,950,000,000

2,000,000,000

2,050,000,000

2,100,000,000

2,150,000,000

Population Growth (%)

Population Projections29% of Global

Population

MEN

ASA

MEN

A

North

Am

erica

Sout

h Am

erica

Euro

pe

59

%

45

%

15

%

9%

10

%33

%

29

%

15

%

8%

8%

Oil Reserves Oil Production

Oil Reserves and Production (% of Global Total)

FDI Projections 2006 - 2013

2006

2007

2008

2009

2010

2011

2012

e

2013

f

2014

f

2015

f

0.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%

0

2

4

6

8

10

12

FDI % of GDP

MENASA region is

emerging as a powerful

economic bloc with

tremendous growth

potential, combining the

sovereign wealth funds (SWFs) of the Mena region

to the economic

growth story of, say, India,

hence, the economic paradigm

shift towards this region from other emerging markets

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3

Iran

GCC REGION :LIQUIDITY ON THE BACK OF HIGH OIL PRICES –KEY EMERGING MARKET

Source: IMF, World Bank

Region was able to quickly recover from the

global crisis on the back

of strong fundamentals and high oil prices

The UAE, the second biggest Arab economy, is set to record 4% growth in GDP in 2013, led by a focus on adopting industrial policies that will drive sustainable development across the UAE.

-IMF 2013 Forecast

Country 2010 2011 2012 e 2013 f

Bahrain 4.1% 1.5% 3.6% 4.8%

Kuwait 3.4% 5.7% 4.5% 5.1%

Oman 4.1% 4.4% 3.6% 3.8%

Qatar 16.6% 18.7% 6.0% 4.3%Saudi Arabia 4.1% 6.8% 3.6% 4.4%

UAE 3.2% 3.3% 3.8% 4.0%

GCC – GDP Projections 2010 - 2013

UAE18%

Saudi Arabia62%

Qatar13%

Oman5%

Kuwait1%

Bahrain2%

GCC – FDI Share by Country 2011-12

Country S&P Moody's Fitch

Bahrain BBB Baa1 BBB

Kuwait AA Aa2 AA

Oman A A1 A

Qatar AA Aa2 AA-

Saudi Arabia AA- Aa3 AA-

UAE AA Aa2 AA-

GCC – Country Ratings 2011-12

GCC region accounted for US $ 70 Bn of FDI funds inflow

GCC Euro Area South Asia MENA

Competitiveness Ease of Doing Business

GCC Ranking 2011-12

GCC region rated most promising region under WEF & World Bank rating

25th 30th

26th 39th

32nd 80th 36th 99th

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UAE:GROWTH PROSPECTS

• Recovery in oil prices

• Strong growth in the non-hydrocarbon sector

• UAE’s service driven economy benefitting from the global trade

• USD 50 billion worth of infrastructural projects still under construction in UAE

UAE Import/Export Projections (% Growth)

Key C

on

trib

uto

rs t

o G

row

th

Oil / Gas as % of GDP (2012)

QATAR

UAE

SAUDI ARABIA

OMAN

BAHRAIN

61%

45%

41%

41%

21%

Source: Dubai Chamber of Commerce

4

2005 2006 2007 2008 2009 2010 2011 2012 (f) 2013 (f)

14

.4

8.3

35

.9

22

.4

-8.9

-1.5

9.2 9.8

5.0

10

.4

11

.2

12

.8

12

.6

-1.9

-4.2

10

.5

6.8

6.1

Imports Exports

DUBAI

THE FINANCIAL HUB OF MIDDLE EAST

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Strengths Reasoning

Highly sophisticated financial centre Dubai is ranked 7th as per ‘International Financial Centres Competitive Assessment Report’ , a competitive study of 15 key global and regional financial centres done by KPMG

Favorable business environment Dubai has been rated very high in ease of doing business ranking 19th globally -World Competitiveness Index

Strategic location with a strong logistics infrastructure to bolster trade

Trade capacity in UAE has tremendously improved over the years with free-zones like JAFZA and trade growth at 15% YTD 2013

Solid tourism sector Hotel occupancy rates remained high throughout 2012 at 90%, benefitting both tourism and trade activities.

- DSC, 2012 Report

Dubai’s core strengths

remain fundamentally

sound

Dubai GDP Share Breakdown by Economic Sectors – 2012

Source : Dubai Chamber of Commerce

“Our vision is clear, our goals are obvious, our strengths are great, our will is strong and we are ready. We want Dubai to be a global center of excellence, creativity and leadership”.

-HH Sh. Mohammed Ruler of Dubai

Well diversified economy based on international trade, banking and finance, tourism, information technology and infrastructure.

DUBAI:VISION & ECONOMIC STRENGTHS6

Government Sector5.2% Financial

Sector10.3%

Trade28.2%

Hotel & Restaurants4.2%

Real Es-tate &

Construc-tion

18.9%

Manufacturing14.3%

Trans-portation

13.4%

Others5.6%

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• Organizational restructuring of government departments & related entities

• Successful debt restructuring across all sectors with zero defaults

• GDP is projected to grow at 4% and above going forward, as per IMF, way above the average GDP growth of western counterparts

Key Achievements in 2013 :

• Dubai GDP growth for 2012 is recorded at 4.5%.

• 15% growth in direct foreign trade

• 8.5% growth in tourism as of YTD 2013 with 2012 recording 13% annual growth

• Dubai is ranked 19th in world competitiveness index up five positions from last year

• UAE ranks 14th in AT Kearney FDI Confidence Index serving as main hub for regional investment

• Real estate market is back on track with 9.1% growth in Q1-Q2, 2013 –making Dubai – the best growth performance internationally.

Seems like the stars

are aligning for Dubai

once again

While challenges remain, the Dubai economy is on a much sounder footing especially as much of the excesses and speculative elements of the economy have been weeded out. What Dubai is now left with is an unparalleled logistics, commercial, retail, communications and transportation infrastructure in the region - and ready for business in a region that is sitting in a fresh pile of cash thanks to high oil prices.

DUBAI:RECENT EVENTS7

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Strong

Oil and gas

Manufacturing

Agriculture

Electricity/Water

Communication

Governmentservices

Construction

Trade

Professionalservices

Financial services Tourism

Transportation and storage

Very weak Average

Dubai’s strength by international standards

Globally fast growing industrieswith a strong position in Dubai

Globally fastergrowing sectors

Future globalgrowth

2010– 2015

Globally slowergrowing sectors

Average globalGDP growth

Sectors qualified to be part of futuregrowth path

Source : DSP 2015

DUBAI:GROWTH PROSPECTS8

CAPITAL MARKETS

UNITED ARAB EMIRATES

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Casablanca Stock Exchange

Algiers Stock Exchange

Tunis Stock Exchange

Libya Stock Exchange Egypt Stock

Exchange

Sudan Stock Exchange

Istanbul Stock Exchange

Tadawul

Tehran Stock Exchange

Qatar Exchange

Palestine Stock Exchange

Beirut Stock Exchange

Damascus Stock Exchange

Iraq Stock Exchange

Kuwait Stock Exchange

Muscat Stock Market

Karachi Stock Exchange

Amman Stock Exchange

Cash & Fixed Income Equity,

Index & Commodity

Futures Only UAE offer a wide array of trade exchanges/products in

the entire MENA region

CAPITAL MARKETS:KEY EXCHANGES IN THE REGION1

0

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55,4

25 1

36,7

07

420,4

74

319,1

56

507,4

74

239,1

83

213,3

77

199,0

86

180,0

93

183,8

37

249,1

65

END-OF-PERIOD MARKET CAPITALIZATION

(2003 – YTD Q3, 2013)

Source : DFM/ND Analytics

MARKET CAPITALIZATIONLIQUIDITY REVIEW1

136% growth in market cap

in the first 9 months of 2013

www.dfm.aeSource : DFM/ND Analytics

TRADED VALUE - DFM (2003 – YTD Q3, 2013 )

DFM exchange has seen a

surge in trading volumes driven by improved domestic economic

environment and

enhanced banking system

liquidity.  The YTD trading

volumes are up 166%

YoY on the DFM

exchange

TRADE VALUES :DFM PERFORMANCE1

2

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 YTD Q3, 2013

3,9

97 5

1,0

56

405,1

61

347,9

80

379,4

10

305,2

02

173,5

08

69,6

65

32,0

88

48,7

74 1

07,8

63

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VELOCITY(2003 – YTD Q3, 2013)

MARKET VELOCITYDFM PERFORMANCE

Source : DFM Analytics

13

7.2%

37.3%

96.4%

109.0%

74.8%

127.6%

81.3%

35.0%

17.8%26.5%

58.1%

DFM / NASDAQ DUBAI

TWO EXCHANGES, ONE MARKET

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Regulatory Authorities

Stock Exchanges ADX DFM NASDAQ Dubai

SCA(UAE Regulations)

DFSA (International Regulations)

19

.9%

79.62%

1%

19.38%

66.67%

33.33%

Public Stake

Ownership Structure

100%

Government of

ABU DHABI

UAE MARKETS :REGULATIONS & OWNERSHIP1

5

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02/0

110/0

118/0

126/0

103/0

211/0

219/0

227/0

206/0

314/0

322/0

330/0

307/0

415/0

423/0

401/0

509/0

517/0

525/0

502/0

610/0

618/0

626/0

604/0

712/0

720/0

728/0

705/0

813/0

821/0

829/0

806/0

914/0

922/0

930/0

908/1

016/1

024/1

001/1

109/1

117/1

125/1

103/1

211/1

219/1

227/1

2

1200

1400

1600

1800

2000

2200

2400

2600

2800

3000

70% Index growth in YTD Q3, 2013 as

compared to 2012

DFM : GENERAL INDEXPERFORMANCE AS OF YTD Q3, 2013

INDEX PERFORMANCE

-- 2012 -- 2013

16

2762.5

Source : Reuters / DFM / ND Analytics

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TRADING ACTIVITY BY CATEGORY

Trading Activity :

Client type Mix

2013 has been a

stabilizing year with

institutional investor trading

hovering around to

24%, however with the MSCI

upgrade to emerging market

status, a surge in

institutional activity is

expected in last quarter of

the year

YTD Q3,2013 – TRADING ACTIVITY PATTERN

AVERAGE RETAIL TRADING = 75.98%

AVERAGE INSTITUTIONAL TRADING = 24.02%

DFM : TRADING PROFILESRETAIL VS. INSTITUTIONAL MIX1

7

Source : Reuters / DFM / ND Analytics

2006 2007 2008 2009 2010 2011 2012 YTD Q3, 2013

85.4

0%

77.6

0%

70.7

0%

79.1

0%

77.6

0%

73.0

0%

75.4

7%

75.9

8%

14.6

0%

22.4

0%

29.3

0%

20.9

0%

22.4

0%

27.0

0%

24.5

3%

24.0

2%

RETAIL INSTITUTIONAL

www.dfm.aeSource : Reuters / DFM / ND Analytics

UAE VS. Non UAETrading Activity

Non UAE Trading Activity

DFM : TRADING ACTIVITYLOCAL VS. FOREIGN INVESTMENT1

8

2006 2007 2008 2009 2010 2011 2012 YTD Q3,2013

69% 70% 63% 60% 56% 52% 54% 57%

31% 30% 37% 40% 44% 48% 46% 43%

UAE Non-UAE

2006 2007 2008 2009 2010 2011 2012 YTD Q3,2013

9% 6% 5% 6% 6% 6% 6% 7%

17%

12%14%

22% 23% 22%25% 22%

5%

12% 18%12% 15% 20%

15% 14%

GCC OTHER ARABS OTHERS

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Trade Activity – By SectorYTD Q3,

2013

Source : Reuters / DFM / ND Analytics

DFM : TRADE MATRICESSECTOR MIX1

9 TELECOM3.2% FINANCE &

INVESTMENT16.7%

BANKS19.7%

INSURANCE1.9%

SERVICES7.0%

REAL ESTATE43.9%

TRANSPORT7.6%

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Distribution of Share

Ownership YTD Q3,

2013

BY TYPE OF INVESTOR BY NATIONALITY

FOREIGN OWNERSHIP AS % OF MARKET CAPITALIZATION

DFM : OWNERSHIP SHARE OWNERSHIP RATIOS2

0

Source : Reuters / DFM / ND Analytics

29%

71%

RETAILINSTITUTIONAL

2006 2007 2008 2009 2010 2011 2012 YTD Q3,2013

10%13%

8%12% 12% 11% 12%

16%

Foreign Ownership

3.21% 5.12%

7.33%

84.34%

ARABGCCOTHERSUAE

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02/01/2013 3/2/2013 4/3/2013 2/4/2013 1/5/2013 30/05/2013 1/7/2013 30/07/2013 1/9/2013 30/09/20130

0.5

1

1.5

2

2.5

DFM Share Price

Movement

YTD Q3, 2013

Trade Volume

YTD 2010

AEDAED 2.05

DFM : MARKET ACTIVITY DFM SHARE PRICE2

1

Source : Reuters / DFM / ND Analytics

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Revenue Breakdow

n2008-

Q3,2013

DFM : REVENUE MIX 2

2

Source : Reuters / DFM / ND Analytics

2008 2009 2010 2011 2012 YTD Q3, 2013

63.2%75.3%

60.2%

43.0%

58.2%

84.3%

32.0%18.4%

28.5%

30.6%

21.0%

10.0%

4.8% 6.3%11.3%

26.4%20.8%

5.7%

Trading Fee & Commisions Investment Income Other Income

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• Easy accessibility

• No income and capital gains tax

• Non-restricted repatriation of capital

• Minimal foreign exchange risk

• Foreign ownership allowed for most listed companies

• Diverse base of listed companies

• Local and international regulatory framework

• Innovative trading capabilities

DFM : INVESTOR-CENTRICATTRACTIVE PLATFORM FOR LOCAL & INTERNATIONAL INVESTORS2

3

DFM : INVESTOR-CENTRICATTRACTIVE PLATFORM FOR LOCAL & INTERNATIONAL INVESTORS

CORPORATE STRATEGY

DFM – NASDAQ DUBAI

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• Upgrade to MSCI Emerging Market Status

• G30 Compliance and addressing the gaps

• Organizational restructuring and monetization of financial services

• Initiating investor –centric services to increase liquidity and trading activities post merger

• Smartphone based services

• IPO focus and listings

STRATEGIC INITIATIVES ADDRESSING FUTURE GROWTH2

5

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Key criteria's

for Emerging market status

Key Features

DFM has met all

eligibitly criteria's for MSCI upgrade and is been

moved to Emerging

Market status

effective June 2014

CRITERIA

A. ECONOMIC DEVELOPMENT

A.1 Sustainability of economic development

B. SIZE AND LIQUIDITY REQUIREMENTS

B.1 Number of companies meeting the following standard index criteria

i) Company size ( Full market cap )

ii) Security size ( Float market cap )

iii) Security liquidity

C. MARKET ACCESSIBILITY CRITERIA

C.1 Openness to foreign ownership

C.2 Ease of capital inflows/outflows

C.3 Efficiency of operational framework

C.4 Stability of the institutional framework

Emerging

No requirement

3

USD 873 Mn

USD 436 Mn

15% ATVR

Significant

Significant

Good & tested

Modest

DFM / ND

Strong economic fundamentals with expected GDP growth of

4.5% for 2013-14

12

USD 68 Bn

USD 18 Bn

55%

49% (Current Foreign

Ownership – 16%)

Significant

Good & tested *

Good ** Successful DVP implementation and introduction of SBL as part of G30 compliance

STRATEGIC INITIATIVES MSCI UPGRADE2

6

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Delivery Vs. Payment :

Implementation

Key Features

UNCHANGED

1. T+2 settlement cycle;

2. Pre-validation of sell orders will be maintained. This means a seller’s agent trading account with local custodian must have securities balances for pre-validation before a sell order can become a valid order.

CHANGED

1. Permitting Local Custodians ability to reject cash and securities settlement of sell trades back to executing Broker for settlement if Local Custodians do not receive (matched) settlement instructions from clients – Local Custodians now have full control of assets [unnecessary to operate dual accounts].

2. Enhancing current rejection process for settlement of purchase trades;

3. Introduction of a Late Confirmation Period of T+4

4. Securities fails handling mechanisms which comprises:

a. Optional buy-in [between T+2 and T+3]

b. Mandatory buy-in by DFM on T+4.

c. Cash close out against the Local Custodian client [if mandatory buy-in against selling Broker by DFM fails on T+4].

5. Penalties for Late Confirmation.

Reasons for adopting the changes

1. Reduce risk in Local Brokers having unlimited access to the Local Custodian Client Agent Trading Account.

2. Eliminate the requirement to use a dual account structure.

3. Progression in meeting international best practices under a pre-validation of sale market infrastructure.

4. Facilitate the achievement of Emerging Market status under the MSCI market classification.

DvP methodology

has been successfully implemented at DFM as of

2012

STRATEGIC INITIATIVES G-30 COMPLIANCE2

7

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New organizational

structure

DFM

DSX ND

Financ

ial

Ser

vic

es

Bu

siness

De

vel

op

me

nt CSD

EXCHANGES

Key Growth Initiatives

• Trading Enhancements• Margin Trading• Equity Swaps• Warrants

• Enhanced Brokerage Services

• iVESTOR Cards

• Dividend Distribution• Market Data

Feed

• Web Advertizing• Online Subscription• IPO initiatives

• e-Reports & e-Services• DVP• SBL

• In-house IPO System

STRATEGIC INITIATIVES ORGANIZATIONAL RESTRUCTURING2

8

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DFM has

commissioned Independent

Research Consultants

forintensive

IPO study

2009Research over 500 companies

in the UAE

2011Research over 500 companies in the region, CIS, and Africa

2010 -2013Dialog with top 100 companies

in prime position of going public on DFM & NASDAQ Dubai

Targeted IPO marketing

campaign to attract issuers

through out the period

2009 Step by Step “ DFM Guide to going public” launched 2010 IPO Market Study Results from one on

one with 40 potential IPO candidates 2011 -IPO Retreat for private, semi-government and family owned businesses.

-MOU with JAFZA (JABAl Ali Free Zones

- Access to Capital Seminar for JAFZA 2012 -Regional IPO Market Study for NASDAQ Dubai

-MOU with Dubai SME -2nd Access to Capital Seminar for SME

2013 -NASDAQ Dubai IPO Guide-Road show for IPO in India & Kuwait.-2nd IPO Retreat on November 19th.

The following initiatives have been taken to support campaign:

STRATEGIC INITIATIVES PIONEERING IPO STUDY2

9

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In-depth market intelligence and value

added services

Investor and consumer visibility

One of the most liquid markets in the G.C.C.

Free accessibility of international investors

In-depth IR and trading analysis

Robust and reliable trading environment

STRATEGIC INITIATIVES ROBUST ENVIRONMENT FOR FUTURE LISTINGS

30

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Racha Al ChamutManager, Investor Relations

P.O.Box: 9700, Dubai, UAE Tel: +971 4 305 5650Fax: +971 4 331 4924rchamut@dfm.ae

Areej Al SaeedOffice ManagerExecutive Chairman's Office

P.O.Box: 9700, Dubai, UAE Tel: +971 4 305 5607 Fax: +971 4 331 4924aalsaeed@dfm.ae

CONTACTS :

ii