jse 2008 annual report
TRANSCRIPT
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Communi
Throu
Dialog
4
0YearsofAchievem
KnowledgeandIn
2008
ANNUAL
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Efficientand
TransparentStockMarket
JAMAICA
STOC
KEXCHANGE
2008ANNUALREPORT
1
2008
ANNUALREP
ORT
Commu
nication
Thr
ough
Dia
logue
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STOC
KEXCHANGE
2008ANNUALR
EPORT
TAB
LEOF
ONTENTS
2
Financia
lStatementofJSE
GroupC
onsolidatedFinancialStatement
Mission
Statement..................................................................................................................................3
OurCorporateObjectives.......................................................................................................................4
st
Noticeo
f32AnnualGeneralM
eeting...................................................................................................5
Director
s'Report....................................................................................................................................6
MembersoftheJSE'sBoardofDirectors..............................................................
.................................7
JSEBoardCommittees2008/2009......................................................................................................11
TheManagementTeam........................................................................................................................12
Chairman'sReportCurtisMartin...........................................................................
...............................13
Chairman'sReportRegulatoryandMarketOversightCo
mmittee(RMOC)-Hilary
PhilipsQ.C..........15
AuditCommitteeReport.......................................................................................................................17
CompensationCommitteeRepo
rt........................................................................................................18
Manage
mentDiscussionandAnalysis................................................................................................19
GeneralManager'sReportJSE.............................................................................................................29
Jamaica
StockExchangeRegulatoryFunctions...................................................
...............................35
Corpora
teHighlights.............................................................................................................................36
Financial&StatisticalHighlights
......................................
.......................................
..............................44
Shareholdings.......................................................................................................................................45
Auditors
Report.....................................................................................................................................46
C
onsolidatedBalanceSh
eet......................................................................................................49
C
onsolidatedIncome
.................................................................
...............................50
C
onsolidatedStatementofChangesinEquity...........................................................................51
C
onsolidatedStatementofCashFlows.....................................................................................52
B
alanceSheet...........................................................................................................................53
Income
..........
.......................................
.......................................
..............................54
S
tatementofChangesin
Equity................................................................................................55
S
tatementofCashFlows
......................................
.......................................
..............................56
N
otestotheFinancialStatements........................................................................................57-99
ProductsFeature................................................................................................................................100
Stockbrokerages&ContactInformation............................................................................................103
JSEYearlyTradingSummary................................................................................
.............................104
Corpora
teInformation.........................................................................................................................105
Stateme
ntofCorporateGovernancePrinciples&Practic
es..............................................................106
Sta
tement
Statement
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KEXCHANGE
2008ANNUALR
EPORT
3
Toprovideafair,efficient,ethical
a
ndtransparentmediumfortheconduct
ofaviablesecu
ritiesmarket
thatfacilitatesthe
mobilizationof
capitaltofinance
thegrowthand
developmento
fthenation.
ISSION
STATEMENT
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STOCK
EXCHANGE
2008ANNUALR
EPORT
4
OU
RCORPORAT
EOBJECTIVE
S
The
JamaicaStockExchang
ewasincorporatedasa
pr
ivatelimitedcompanyin
August1968,withthe
sto
ckmarketcommencing
operationsinFebruary
1969
.
Itsprincipalobjectivesare:
Top
romotetheorderlyandtransparentdevelopment
ofthe
stockmarketandthestockexchangeinJamaica.
Toen
surethatthestockmarketanditsbrokermembers
operateatthehigheststandardspracticable.
Todevelop,applyandenfor
cetherulesdesignedto
en
surepublicconfidenceinthestockmarketand
itsbroker-members.
Toprovidefacilitiesforthetransactionofstock
marketbusiness.
Toconductresearch,disseminaterelevant
in
formationandmaintainlocalandinternational
relationshipswhichcanenhancethedevelopment
oftheJamaicas
tockmarket.
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STOCK
EXCHANGE
2008ANNUALR
EPORT
5
nd
NOTICEISHE
REBYGIVENthattheTh
irtySecond(32)AnnualGeneralMeetingoftheJamaicaStockExchangewillbeheld
attheJamaica
StockExchange,40HarbourStreet,Kingstonon
Thursday,June25,200
9,commencingat1:00p
.m.forthe
followingpurpo
ses:
1.
Toapp
ointDirectors.
Thefo
llowingDirectorswillret
ireattheAnnualGeneralMeetingandareeligibleforre-appointmentfo
rtheyear
2009/2
010inaccordancewithA
rticle95oftheArticlesofAssociationofAssociationoftheCompany.
Mr.ChristopherWilliam
s
-
Retirin
g
o
MissDianBlack
-
Retirin
g
o
Mr.GarthKiddoe
-
Retirin
g
o
Mr.AllanLewis
-
Retirin
g
o
Mr.LivingstoneMorriso
n
-
Retirin
g
Toconsiderand(ifthoughtfit)passthefollowingresolutio
n.
ThattheretiringDirectorsbeand
areherebyre-electedasdirectorsoftheCompany.
2.
Tofixtheremunerationofthe
Auditorsortodetermine
themannerinwhichsu
chremunerationistobefixed.To
consid
erand(ifthoughtfit)pass
thefollowingResolution:
ThattheDirectorsbeandareherebyauthorizedtofixtherem
unerationoftheAuditors
atafiguretobeagreedwith
them.
Toreceive,andifapproved,adopttheAuditedFinancialStatementsfortheyeare
ndedDecember31,2008,together
withtheDirectors'andAuditors'Reports.Toconsiderand(ifthoughtfit)passthefo
llowingResolution:
ThattheAuditedFinancialStatementsfortheyearendedD
ecember31,2008,andthe
ReportsoftheDirectorsan
dAuditors
beadop
ted.
TofixthefeesoftheDirectors
ortodeterminetheman
nerinwhichsuchfeesa
retobefixed.Toconsiderand(if
though
tfit)passthefollowingRe
solution:
ThattheDirectorsbeandareherebyauthorizedtofixtheirfeesforthefiscalperiod2009/2010.
Totran
sactanyotherordinarybusinessofthecompany.
th
DATEDTHIS1
5DAYOFMAY2009
BYORDEROF
THEBOARD
.
MarleneJ.Stre
et-Forrest
Secretary
IMPORTANTN
OTEFORMEMBERSW
HOARENOTABLETO
ATTEND:
AmemberentitledtoattendandvoteatthemeetingcanappointaProx
ytovoteonhisbehalf.The
personsoauthorizedshall
beentitled
toexercisethesa
mepowersasthememberw
hichherepresents.
NOTICEOF32ndANNU
ALGENERAL
MEETING
3.
4.
5.
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EXCHANGE
2008ANNUALR
EPORT
6
TheDirectors'submitherewiththeStatementofConsolidated
RevenueExpenses,Profit,AssetsandLiabilitiesofthe
JamaicaStock
Exchangeanditswhollyownedsubsidiary,the
JamaicaCentralSecuritiesDepositoryfortheyearended
December31,2008.
OperatingRev
enuefortheyearwas$470.3m
comparedtotherevenueof$205.9m
for2007,anincreaseo
f128.4%.
InvestmentIncomewas$91.0mcompar
edto$34.9m,anincreaseof160.8%over2007.
Totalexpenses
fortheyearincreasedby
42%to$302.3min2008
.Therewasasurplusfro
moperationof$173.9m
compared
toadeficitof$7
.9min2007.
Totalassetsof
thecompanyanditssub
sidiaryasatDecember31,2008were$1,332.6m
comparedto$1,003.6m
for2007.
ThesefiguresincludeCompensationFundAssetsof$510.1mand$463.8mfor2008an
d2007respectively.Shareholders
equitydecreasedby1.5%from$928.3m
to$914.2m.
Theauditors,D
eloitteandTouchehavesignifiedtheirwillingnesstocontinueinoffice.
........................
.......................................
.......
Mr.CurtisMartin
Chairman
DIRECTORSREPORT
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2008ANNUALR
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7
DIRECT
ORSANDSE
NIORMANAG
EMENT
PROFILESOF
DIRECTORS
Mr.CurtisMartin-Chairman
CurtisMartinistheChairmanofthe
JamaicaStock
ExchangeLimitedand
alsotheJama
icaCentralSecurities
DepositoryLtd.HeisPresidentand
CEOofCapita
landCreditMerchant
BankandDeputyGroupPresidentof
CapitalandC
reditFinancialGroup
Ltd.Mr.MartinisChairmanofthe
ListingandStandardsCommittee,the
Compensation
Committee
and
the
ExecutiveCommitteeoftheJSE.
Mr
.LeoWilliams
Leo
WilliamsistheExecutiveDirectorofWilliams
&A
ssociatesInvestmentsLtd.This
firmseeksto
attr
actcapitaltobusinessesseeking
todevelopin
the
region.Oneoftheirmostrecent
successesis
the
conceptualization
and
successful
cap
italizationofthefirstREITintheCaribbean.
ThisnowtradesontheJamaicaSto
ckExchange
as
theCarltonSavannahREITorCREIT.Heis
alsoDirectorofJCSD.
Mrs.RitaHumprie
s-Lewin
Mrs.Humphries-Lewin
is
a
past
ChairmanoftheJS
EandistheFounder
andChairmanoftheBaritaGroupof
Companies
whic
hincludes
Barita
InvestmentsLimite
d,BaritaUnitTrusts
ManagementCom
panyLimited
and
BaritaPortfolioManagementCompany
Limited.Sheison
eofthepioneersof
thestockbrokingindustryhavingbeen
inthebusinessfor
approximatelythirty-
five(35)years.
Mr.EdwinMcKie
Mr.McKieistheChairmanand
Managing
DirectorofM/VLStockbrokersLimited.Mr.
Mc
Kie,whowasawardedthe
Orderof
Dis
tinction
CommanderClass
forhis
ser
vicestoJamaicainthefieldofbanking,is
aformertradeadministratorandformer
Chairman
ofthe
Trade
Board
and
the
AgricultureCreditBank.Healsos
ervedasa
BoardMemberoftheNationalInvestment
BankofJamaicaandtheBanko
fJamaica.
He
currentlyservesontheBoardofthe
DevelopmentBankofJamaica.M
r.McKieis
the
ChairmanoftheCorporateGovernance
CommitteeoftheJSE.
Priortothat,hewastheInternationalBusiness
DevelopmentManagerofJMMBLtd.theparent
com
panyofJMMBSecuritiesLtd.
Hewasthe
foundingManagingDirectorofJMM
BSecurities,
the
stockbrokeragearmofJamaicaM
oneyMarket
Bro
kers.Mr.WilliamsresignedasaD
irectorofthe
JSE
inJune2008.
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2008ANNUALR
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8
DIRECT
ORSANDSE
NIORMANAG
EMENT
PROFILESOF
DIRECTORS
Mr.DonovanPerkins
DonovanPerkins
isthePresident&
CEO
ofPan
Caribbean
Financial
ServicesLimited(PCFS).Inaddition
toservingonthe
BoardswithinPan
Caribbean,Mr.Pe
rkinsservesonthe
BoardsofPan-Ja
maicanInvestment
TrustLtd.,FirstJa
maicaInvestments
Ltd.,JamaicaPro
ducersGroupLtd.,
NationalInsuranceFund
and
the
NationalWaterCo
mmission.Heisan
active
executive
ofthe
financial
servicescommunity,havingservedas
VicePresidentoftheJamaicaBankers
Associationand
thePrivateSector
OrganizationofJamaica.
Mr.MarkCroskery
Mr.M
arkCroskeryisthePresident&C
EOofStocks
&Se
curitiesLtd(SSL)andservesas
aCompany
Spec
ificDirector.Mr.Croskeryisrespo
nsibleforthe
Company'sgrowth,profitabilityandstrategicvision
tomakeSSLtheleadingproviderofG
lobalWealth
ManagementsolutionstoJamaicans.
Mr.
Croskery
previouslyinterned
atPrudential
Financial,Inc.(nowWachoviaSecurities)inMiami,
Floridaonthefixedincomedeskbeforegoingonto
being
theleadingWealthManager
atNational
CommercialBankCapitalMarketsLtd.
(NCBCM)as
wella
sanEquityTrader.
Mr.CroskeryservesasaDirectoro
ntheSugar
CompanyofJamaica(SCJ)whereheservesonthe
Fina
nce
and
AuditSub-Committee,as
a
CommissionerontheJamaicaRacing
Commission
(JRC
)whereheservesontheFinan
ceandAudit
Sub-CommitteeandontheIslandIce
&Beverage
Company(Jamaica).
Mr.ChristopherW
illiams
ChristopherWillia
ms
is
the
Managing
DirectorofNCBC
apitalMarketsLimited.
HecurrentlyservesasChairmanofthe
JamaicaAssociationfortheDeaf,Director
ofthe
Jamaica
College
Old
Boys
Association,Dire
ctorofthe
Jamaica
CollegeFoundation,andCouncilMember
ofthe
Jamaica
Securities
Dealers
Association.
Mr.Williamsisals
oaDirectorofseveral
NCB
subsidiaries,these
are:
NCB(Cayman)Lim
ited,NCBInvestments
Limited,NCBCap
italMarkets(Cayman)
Limited
and
NCB
Insurance
Company
Limited.
Mr
.AllanLewis
Alla
nLewisistheSeniorVicePresident,Group
Strategy,oftheVictoriaMutualG
roupLimited
wherehehasservedforthepast3y
ears.Priorto
this
,Mr.LewisservedasManagin
gDirectorof
PrimeAssetManagementLimited,
whereheis
currently
a
Director.Mr.Lewis
has
had
a
distinguishedcareerinlifeinsurance
andpension
fundriskmanagement,assetmana
gement,and
stra
tegicplanning.Heachievedthedesignation
Ass
ociateoftheSocietyofActuariesin1986,anda
MastersinBusinessAdministrationin
1987.
No
twithstanding
his
pro
fessional
acc
omplishmentsheiscommittedtosupporting
the
widercommunity.Hispassionfo
rprimaryand
sec
ondaryeducationmotivatedhim
toobtaina
MastersinEducationin2002.Allanisamemberof
the
KiwanisClubofNorthSt.Andrew
;amentorfor
studentsattheUniversityoftheWestIndiesandis
am
emberoftheBoardofDirectors
oftheMona
Pre
paratorySchoolFoundation.
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EPORT
9
DIRECT
ORSANDSE
NIORMANAG
EMENT
PROFILESOF
DIRECTORS
Mr.ChristopherBerry
ChristopherBerry
hasbeenthe
Chairman
and
ChiefExecutive
OfficerofMayberryInvestments
Limited
since
19
93.A
former
DeputyChairman
oftheJSE,he
sitsonseveralbo
ards,including
the
Jamaica
Cen
tralSecurities
Depository,
theForestry
Conservancy,Ape
xHealthCare
Associates
Limitedand
Apex
PharmacyLimited.
MissSandraShirley-DeputyChairman
SandraShirleyassumedtheroleofP
residentof
FirstGlo
balFinancialServicesLimitedonApril1,
2004andrelinquishedthisofficeinOc
tober2008.
Miss
Shirley
has
overtwenty
(20
)years
of
experien
ceandexpertiseinthefinanc
ialsectorin
Jamaica
andoverseas.Shehasw
orkedwith
entitiess
uchastheBankers'Trust,NewYork,NCB
Group,
theSIGMA
Group
and
its
associated
entitiesa
ndnowlendsthatexpertiseto
FirstGlobal
Financia
lServices.Miss
Shirley
serves
in
a
numberoforganizationsincludingtheSoroptomist
Club,th
eCouncilofCommunityC
ollegesof
Jamaica
,theIndependenceParkLtd,
theWomen
inIntern
ationalTradeInvestmentClub,andthe
NationalDanceTheatreCompanyof
Jamaica.In
2003,sh
ewasaskedtoservetheMon
aSchoolof
BusinessasanAlisterMcIntyreFellowandmore
recently
theJamaicaInstituteofManagementhas
conferredonheritshighestaward,Fellowofthe
Jamaica
nInstituteofManagement.Sheresigned
asDirectoroftheJSEinOctober2008.
MissAnyaSchnoor
AnyaSchnooristheC
hiefExecutiveOfficer
ofScotiaDBGInvestmentsLimitedandthe
SeniorVicePreside
ntoftheScotiabank
Group'sWealthMana
gementDivision.She
is
also
the
Presidentofthe
Jamaica
Securities
DealersAssociation
and
has
servedasthePres
identofthePrimary
DealersAssociation.
SheisaDirectorof
ScotiaDBG
MerchantBank,ScotiaDBG
Fund
Managers
and
Prime
Asset
ManagementLimited.Sheisalsoamember
oftheHEARTNTAFinanceCommitteeand
sits
on
Scotiabank
Jamaica's
ALCO
Committee.
M
rs.MarleneStreetForrest
M
arlene
Street-Forrestis
theGeneral
M
anageroftheJamaicaStock
Exchange.
M
rs.Street-Forresthas
a
B.Sc.in
M
anagementStudiesandanMBA.Shehas
overtwenty
five
years
of
combined
experience
in
financialan
dgeneral
m
anagement.
Hermandate
asGeneral
M
anageroftheJSE,istoc
ontinuethe
process
ofdeveloping
the
Exchange,
ensuringthatcuttingedgete
chnologyis
usedtoassistinprovidingtheg
reatestlevel
ofefficienciesinthemarket.Mrs.Street-
Forrest,whoisaJusticeof
thePeace,
servesasSecretaryoftheBoar
doftheJSE
anda
Directorofthe
Jama
icaCentral
SecuritiesDepositoryLtd.
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STOCK
EXCHANGE
2008ANNUALR
EPORT
10
MissDianBlack
DianBlackistheDirector,Securities
Management(D
ebtManagementUnit)
intheMinistryo
fFinance&thePublic
Service.In
thiscapacity
she
has
responsibilityfor
allactivitiesrelatedto
theregistrarand
paymentsfunctionsfor
governmentsecuritiesandprovidesthe
necessaryinterfacebetweentheJSE
andtheGovernm
ent.
MissHilaryPhillipsQ.C.
HilaryPhillipsisaPartnerinth
elawfirm,
Grant,Stewart,Phillipsand
Company
where
she
has
practised
for
approximately
30
years.
She
was
elevatedtotherankofQueen
'sCounsel
in1998andhasbeenthePre
sidentand
Vice
Presidentofthe
Jam
aican
Bar
Association.ShehasservedastheVice
Presidentofthe
Organisation
of
Commonwealth
Caribbean
Bar
Associationssince2003-2007.
Miss
PhillipsistheChairmanofth
eConduct
ReviewCommitteeandtheRe
gulatory&
MarketOversightCommitteeo
ftheJSE.
INDEP
ENDENTMEMBERSOFTH
EJSEBOAR
DOFDIRECT
ORS
Mr.RobertDrummo
nd
RobertDrummondwa
sappointedPresidentof
FirstGlobalFinancialServicesLimited,effective
November1,2008.Priortohisappointment,Mr.
Drummond
was
the
CEO
ofFG
Funds
Management
(Cayman)
Limited,
GraceKennedy'smutualfundsmanagement
business.Inaddition
,healsofunctionedas
PrincipalofGK
In
vestments,developing,
executingandintegratingmergers,acquisitions
andnewbusinessven
tures.
RobertDrummond
joined
GraceKennedy
LimitedinFebruary2005asGroupBusiness
DevelopmentManage
r.HejoinedtheBoardof
theJSEinOctober2008.
JulianMair
Julia
nMairistheChiefInvestmentStrategist
atJa
maicaMoneyMarketBroker
sandhas
over
16yearsofexperienceinthe
Jamaican
finan
cialsector.Mr.Mairhasheldp
ositionsat
lead
ing
Jamaican
financialin
stitutions
inclu
dingHeadofTreasuryandInvestment
servicesatDehring,BuntingandG
oldingand
SeniorTraderand
Cambio
Managerat
JMM
B.Inaddition,Mr.Mairwasfo
rmerlythe
ManagingDirectorofLetsInvestmentLtd.
HeisafoundingmemberoftheJamaica
SecuritiesDealersAssociation.He
servesas
aDir
ectorofJMMBSecuritiesLimited,JMMB
Inter
nationalandJMMBBDIAmerica.
DIRECT
ORSANDSENIORMANAG
EMENT
PRO
FILESOFDIRECTORS(Con
td)
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STOCK
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2008ANNUALR
EPORT
11
Mr.Livingstone
Morrison
LivingstoneMo
rrisonistheDeputy
Governorofthe
BankofJamaicawith
responsibility
for
Finance
and
Technology,PaymentSystems,
InvestmentandRiskManagement.
Mr.Morrisonjo
inedthestaffofthe
BankofJamaicain1982andworked
forseveralyearsin
the
Financial
InstitutionsSupervisoryDivision.
Between1998a
nd2002,Mr.Morrison
servedastheDivisionChiefofthe
Finance
and
Technology
Division,
withcoreresponsibilitiesforstrategic
management
ofthe
accounting,
finance,and
information
and
communication
technologyfunctions
oftheBank.M
r.Morrisonisalsoa
Directorofth
eJamaica
Central
SecuritiesDepository.
J
SEBOARD
COM
MITTEES2008/2009
LISTINGSTANDARDSCOMMITTEE
Chairman:
Mr.CurtisMartin
MissSandraShirley
Mrs.RitaHum
phries-Lewin
Mrs.MarleneStreetForrest
Mr.Christo
pherWilliams
Mr.Livin
gstoneMorrison
CONDU
CTREVIEWCOMMITTEE
Chairman:
MissHilaryPhillips,Q.C.
Mr.Livin
gstoneMorrison
MissDianBlack
Mr.GarthKiddoe
Mrs.JaneGeorge
COMPENSATIONCOMMITTEE
Chairman:
Mr.CurtisMartin
Mr.GarthKiddoe
MissHilaryPhillips,Q.C.
Mr.DonovanPerkins
Mr.MarkCroskery
R
EGULATORYANDMARKETOVERSIGHTCOMMITTEE
C
hairman:
MissHilaryPhillips,Q.C.
MissDianBlack
Mr.GarthKiddoe
Mr.Livin
gstoneMorrison
Mrs.JaneGeorge
A
UDIT&FINANCECOMMITTEE
C
hairman:
Mr.GarthKiddoe
MissHillaryPhillips,Q.C.
MissDianBlack
Mr.EdMcKie
(oralternateDr.
DerrickMcKoy)
Mr.AllanLewis
Mr.Livin
gstoneMorrison
Mr.JulianMair
C
ORPORATEGOVERNANCE
C
hairman:
Mr.EdMcKie
(oralternateDr.
D.McKoy)
Mrs.MarleneStreetForrest
Mr.GarthKiddoe
MissSandraShirley
MissAn
yaSchnoor
NOMINATINGCOMMITTEE
AllBoardMembers
INDEPENDENTMEMBERSOFTHEJSEBOAR
DOFDIRECT
ORS
(Cont
d)
Mr.JaneGeo
rge
Mrs.JaneGeorgeassumedtheroleof
CorporateAttorney-at-LawandHeadof
the
LegalD
epartmentand
Corporate
SecretariatoftheLascelles,deMercado
GroupofCom
paniesin2001.Sheisa
memberoftheLawSocietyofEngland&
Walesandthe
JamaicanBarAssociation.
Mrs.George,
whohasapproximately20
yearsexperienceandexpertiseinthe
legalprofess
ion
in
Jamaica
and
the
UnitedKingdom,joinedtheBoardofthe
JamaicaStoc
kExchangein2008.She
sits
on
the
Regulatory
and
Market
OversightCo
mmitteeandtheConduct
ReviewComm
itteeoftheBoard.
Mr.GarthKiddoe
Mr.KiddoeistheformerDeanofthe
FacultyofBusinessand
Management
atthe
University
of
Technology,
Jamaica
and
previouslythe
Chief
FinancialOfficerattheJamaicaPublic
ServiceCompanyLimite
d.Heisthe
immediate
pastPresidentofthe
InstituteofCharteredAccountantsof
the
Caribbean
as
wellas
its
representativeontheBoa
rdofTrustees
oftheCaribbeanCourtofJusticeTrust
Fund.HeisaPastPre
sidentofthe
InstituteofCharteredAccountantsof
JamaicaandoftheJama
icaInstitution
ofEngineers.Mr.Kiddoe
is
the
ChairmanoftheAudit
andFinance
CommitteeoftheBoardoftheJSE.
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2008ANNUALR
EPORT
12
T
HEMANAGEM
ENTTEAM
From
lefttoright:
MissMichelleSirdar
-
Manager,Re
gistrarServices(JCSD
)
Mrs.B
eulahJohnson
-
Manager,Eq
uityOperations(JCSD
)
Mr.RobinLevy
-
GeneralMan
ager,JCSD&Deputy
GeneralManager,JSE
MissRiccalyaRobb
-
TradingOffic
er
Mrs.M
arleneStreetForrest
-
GeneralMan
ager,JSE
MissJosephineLewis
-
Manager,Tru
steeServices(JCSD)
MissSuzetteMcNaught
-
Manager,InformationTechnology&Systems
Mrs.D
oreenParsonsSmith
-
HumanReso
urcesOfficer
Mr.W
entworthGraham
-
ChiefRegula
toryOfficer
Mrs.S
uzetteWhyte
-
AccountingM
anager
Mr.NevilleEllis
-
SeniorMarke
tingOfficer
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2008ANNUALR
EPORT
13
F
romtheCha
irman'sDesk
Mr.CurtisMartin
Chairman
(C
ontinued)
TheJamaicaStockExchange(JSE)weathersthestorms.
Thewordthatbest
describestheyear2008
ischallenging.Thisistheyear
whenweexperiencedamajordownturnintheglobaleconomyresultin
gfromthe
USsubprimedebacle.Thiswascompounded
bytheincreaseinoilpric
esandthe
collapseofsomeofthemajorUScorporation
s.Thiscausedmanytremorsinthe
Jamaicaneconomy,withaworseningofthe
country'scurrentaccountdeficit,a
declineintheNetInternationalReserve(N
IR)anda13.68%
declineinthe
Jamaicandollar,2007.Theseshocksare
notimmediatelynoticea
bleinour
financialresultsasw
ewerebuoyedbyafewlargevolumeandvaluetransactions
ontheExchange.
Basedontheglobalandlocalchallenges
withinthefinancialsector,normal
marketactivitiesreg
isteredsignsofafurther
slowdown.However,in
spiteofall
thesechallenges,th
eJamaicaStockExchangewasabletoachievese
veralofits
objectivessetoutfo
rthe2008/9period,whic
hwereinkeepingwithit
sstrategic
direction.ThreemajorobjectivesthattheJSE
achievedduringtheyearwere:
1.
Demutualization
AsIindicatedin2007,theJSEwouldhavemovedwithala
critytobe
demutualized.Iamindeedpleasedtoreportthatwecompletedthefinal
phaseofth
edemutualizationproce
ssonApril2,2008.Con
sequently,
theindepen
dentRegulatoryMarket
andOversightCommitte
e(RMOC)
andDivisio
n(RMOD)wascreated.Mr.WentworthGrah
am,Chief
Regulatory
Officer,managesthisDivision.TheRegulatoryM
arketand
OversightC
ommittee,whichiscom
prisedofindependentm
embersof
theBoarda
ndchairedbyMissHilary
Phillips,Q.C.isrespons
ibleforthe
oversightofthisDivision.
Theseimprovementswillresultinstronger
regulatoryo
versightandgreatermar
kettransparency.
2.
ListingoftheJSE
OnJune30
,2008,weexperienced
anothermajormilestone
whenthe
JSE'sPreferenceShareswerelis
tedonitsownExchan
ge.
This
achievementisthefirstofitskindwithintheCaribbeanRegionandwe
havejoined
Exchangessuchasthe
NewYorkStockExchangeandthe
LondonSto
ckExchangeintakingthispath.
Wemustex
pressourgratitudetothepublicforthetremendoussupport
ofourInitia
lPublicOfferinginwhichweraisedJ$66M.The
Offerwas
oversubscribedbyapproximately200%.
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2008ANNUALR
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Fro
mtheChairman'sDesk(Contd
)
.......................
.......................................
...
Mr.CurtisA.M
artin
Chairman
JamaicaStock
Exchange
May21,2009
3.
Draftin
gofDocumentsforthe
IntroductionoftheJuniorMarket
SmallandMediumsizedbusine
ssesaretheengineofgr
owthinanyeconomyastheyareabletocreateem
ployment
andus
uallygenerategoodvalu
efortheirowners.Inkeepingwithitsvision,the
JSEsawtheneedtointroducethe
JuniorMarkettoaccommodate
smallandmediumsized
businessestoaccesseq
uitycapital.Consequently,theJSE
madeaproposaltotheGovernm
entontheessentialplatformandarisingfromthis,inOctober2008Cabinetsignaled
itssupportfortheJuniorMarketbyapprovingcertaintax
benefits.TheJSEwillbe
launchingtheJuniorMa
rketbythe
firstquarterof2009.
BoardMembe
rs
TheMemberso
ftheBoardworkedassid
uouslyin2008,toensure
thattheJSEcontinuesitsmandatetoprovideafa
ir,efficient
andtransparentstockmarkettoits
stakeholders.TheBoa
rdsspecialfocusduringtheyearwasthep
rocessof
demutualization,thepreferenceshare
issueandtheprocessw
hichwillultimatelylead
totheestablishmentof
theJunior
Market.Iamex
tremelygratefultotheme
mbersfortheircontributionthroughout2008.
Iwouldalsolike
tothankthemanagementandstaffoftheJSEfortheirinvaluableeffortsduringtheyear.
GoingForward
TheJSEwillmaintainitspartnershipwithitskeystakeholdersine
nsuringthecontinuedde
velopmentofaviablesto
ckmarket.
Wearelooking
forwardtoforgingdeeperallianceswithourCaribbeanneighbourstoe
nsurethattheExchang
esremain
relevantandareabletowithstandthech
allengesassociatedwith
theglobalfinancialmeltd
own,which,fromallindicationswill
worsenin2009
.Wewillbelookingatw
aysthatwillenableustoimproveregulationofthemarketsoastoboostinvestors'
confidenceand
mostimportantlyexpand
themarket.
Whileweareexpectingaverydifficult20
09/10periodasthefallou
tcontinuesintheglobalmarketplace,weremaincommitted
toprovideafair
,efficientandtransparentstockmarketasaninteg
ralpartofthegrowthofthecapitalmarketinJamaica.
FinancialHigh
lights
Inspiteofthechallengesin2008,theJSEwasabletoweatherthe
storm.TheyearendingDecember31,2008sawallareasof
incomeincreas
eoverthepreviousyear
(2007).ThisisdueprimarilytotheLascelles/CLSpiritsTransaction,which
positively
affectedCessRevenue,FeeIncomea
ndInvestmentIncome.
ThisisreflectedintheC
ompany'sConsolidated
Financial
Statements.Th
eCompany'sFinancialStatementsshowthatOp
eratingIncomefor2008
was$470.3millionrepresentinga
remarkableincreaseof$264.4millionor
128.4%overthefigureof$205.89millionrecordedforthepreviousyear.Su
rplusfrom
Operationsof$
173.9millionincreasedb
y$181.9millionor2,302%
,whencomparedtothe
performancein2007.
Netsurplusfor
2008was$207.7million
,upsignificantlyfrom$4
4.1millionin2007which
isanincreaseof$163.6
millionor
370.81%.Inves
tmentIncomewas$91.0
3millioncomparedto$34
.91millionin2007.
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15
MissHilaryPhillipsQ.C.
Chairman
(C
ontinued)
TheYear2008inReview
Theyear2008oug
httoresonateinthemindsofmanyforavery
longtime
becauseoftheglob
alfinancialturbulenceth
ataffectedestablishedb
usinesses
andordinarypeople
.Clearly,onewillalsore
memberthatthesituatio
ntested,if
notexposed,them
ettleoftheregulatory
operationsinmostma
rketsand
Jamaicawasnoexception.Whilethemagn
itudeofthetestsvariesacrossthe
globe,theJamaicaStockExchange(JSE),andmorespecificallytheR
egulatory
andMarketOversightCommittee,whichoverseestheregulatoryresponsibilities
oftheJSE,wasconfrontedwithissuesthat
requiredkeenattention.Inthese
circumstancestheRMOChadtobeboldandthoroughinitsdecisionmaking
process,asitsough
ttomaintainitsresolveto
promotemarkettranspa
rencyand
integrity,whichultim
atelyresultsinsafeguardingtheinterestofthemarket.The
RMOCiscommittedtobeingfairandaccu
rateinwhatitdoes;the
refore,its
decisionsweretake
nagainstthebackgroundofin-depthanalysisa
ndexpert
advice.Inthisregard,itcanthereforereportthatalldecisionstaken
duringthe
courseofthelast1
2monthswererespectfullyreceivedandacceptedbythe
marketanditsstakeholders.
AchievementsDuringtheYear
WhileImaynotbeatlibertytodivulgeth
edetailsoftheissues
thatwere
undertakenbythe
RMOC,itcanbereportedthatovertheperiod
,thetotal
numberofissuesthatwereassessedbyth
eRegulatory&Market
Oversight
Division(RMOD)was86,whichrepresentsmorethan300%increas
eoverthe
previousyear.Thischangecouldbeattrib
utedtotheRMOD'scon
centrated
operationsontheEx
change'sregulatorymatters.
Chairman'sReport,RegulatoryandMarketOversightCommittee
(RMO
C)
NatureofCases
Number
MarketInfractions
67
Complaints
8
OtherComplianceIssues
11
Total
86
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OtherRegulat
oryMattersin2008
FortheperiodinreviewtheRMOCwas
abletosatisfythefollow
ing:
1.
Ta
blingnewrulesfortheJ
SE,namely,THERMOC
,DisciplinaryProceedin
gsandManagementDis
cussion&
Analysis(MD&A).
2.
StaffingtheRMODwithits
fullcomplementofofficers.AttheinceptionofitsoperationsonApril1,2008it
hadonlytwo(2)officersandbyMayitwasableto
recruitanothertwo(2)to
completethestaffing
re
quirements.
3.
TheRMOCwasabletoclosemostoftheissuesth
atweretransferredtoitfromtheBoardoftheJS
E.
4.
TheCommitteewasabletocompleteitsfullcomplementwiththeinclusion
ofMrs.JaneGeorge,an
In
dependentBoardMemb
eroftheJSE,whorepre
sentsthePrivateSector
OrganizationofJamaica
.
5.
Otherachievementsofthe
Committeeinclude,steeringtheRMODto:
a.Undertakeapro
cessthathasledtothecreatingofalogoandtagline.
b.DevelopandimplementitsMissionState
ment,whichisTopromotemarkettransparency,integrity
andefficiencybyprotectingandadvancingstakeholders'welfare
throughtheenforcemen
tofrules,
marketsurveillance,brokerinspectionsa
ndtheassessmentofm
arketdocumentsandfin
ancial
statements.
c.CreatecontentfortheDivision'spageon
theJSE'swebsite.Itis
importanttonotethaton
the
websitethereis
aComplaintLog,RMOD
contactinformation(fax
,emailandtollfreenum
ber)and
marketrules.
d.Establishpropercommunication,filing,d
ocumentaryandoperatingprocedurestopreserv
e
informationconf
identially.
PlansfortheF
uture
AsChairmano
ftheRMOConeoughttoacceptthatmyprognosisofwhatliesaheadfor
theCommitteeandtheRMOD
shouldbecons
ideredaccurateandcredible.OnthatscoreIwillreportthatthefuturelooksratherinterestingandexciting.
Thisviewispro
videdagainstthebackg
roundof:
1.
DevelopingnewJSERule
sasitrelatestoFinesandaComplaintManagem
entSystem.
2.
Thecurrentwork-in-progressoftheRMOD'sautom
atedmarketsurveillancesystem,whichiswithin
budget
andis,slatedtobecompletedbySeptemberofthisyear.
3.
UndertakingsbytheRMODofnotonlyenforcingm
arketrulesbutpromotin
gcompliance.
4.
ThecommitmentoftheRM
OCandtheRMODtofulfillitsobjectivesandsa
tisfytheexpectationsof
its
stakeholders,whichisasdocumentedinitsstrateg
icplan.
Chairman'sReportRegulatoryandMark
etOversightCom
mittee(RMOC)C
ontd
........................
......................................
...
MissHilaryPhillipsQ.C.
Chairman
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AuditandFinanceCommitteeReport
TheJama
icaStockExchan
geandItsSubsidiaries
DuringtheyearunderreviewtheAuditandFinanceCommittee(theCommittee)oftheB
oardofDirectors(theBo
ard)ofthe
JamaicaStockExchange(theExchange
)assistedtheBoardindischargingitsoversightof:
1.
Th
eintegrityoftheFinancialStatementsoftheCompany
2.
TheadequacyoftheExchange'sinternalauditfunction,internalcontrolsandfinancialreportingsystemsand
pro
cedures
3.
TheExchange'scompliancewithlegalandregulatory
requirements.
4.
TheExchange'sInvestmentManagement
5.
Themember/dealers'compliancewiththeStockExchange'sRulesintermsof
policyandprocedures
Theroleofthe
Committeebecamethesubjectofadditionalfocu
sandattentionwiththedemutualizationoftheExchangein
April2008,and
thesubsequentissuea
ndlistingofpreference
shareswhichsubjected
theExchangetotherep
ortingand
complianceregimethatgovernsalllistedcompanies.Responsibilityformember/de
alers'compliancewith
theStock
Exchange'sRu
lesintermsofpolicyand
procedureswastransfer
redtotheRegulatoryandMarketOversightComm
ittee.The
AuditandFinanceCommitteehad15s
cheduledandspecialmeetingsduringtheyearw
ithsatisfactorylevelofa
ttendance
fromthemembershipcomprisedof:
GarthK
iddoe(Chair)
DianB
lack
EdMcKie
AllanL
ewis
JulianMair
Livings
toneMorrison
HilaryPhillips,Q.C.
TheManagementoftheExchangeisres
ponsibleforthepreparationandfairpresentationofthefinancialstatementsandother
reportsinacco
rdancewithpoliciesapp
rovedbytheBoard.Pe
riodicreportsbyManag
ementanddetaileddisc
ussionsat
Committeemeetingsconfirmedthecontinuedeffectivenessofinternalcontrols,theaccura
cyandcompletenessofaccounting
recordsandfinancialstatementsaswell
asthereasonablenessofaccountingestimates.
TheCommittee
alsoreceivedregularbriefingsfromtheinternal
auditorsregardingcomp
lianceissues,internalco
ntrolsand
otherinformationthathaveamaterialeffectontheCompany'sfinancialstatementsando
thercompliancerequirem
ents.The
Committee's
recommendationstothe
BoardaimedatstrengtheningtheCompany's,
investmentpolicies,internalaudit
functionandinternalcontrolsystems,we
reaccepted,implemente
dandarereviewedregularly.
Theprogrammeofworkforthefinancialyearconcludedwiththecoordinationoftheannual
audit.TheCommitteerev
iewedand
agreedthesco
peoftheannualauditw
iththeexternalauditors
andhasreviewedtheau
ditedfinancialstatemen
tswiththe
company'smanagementandexternalauditorspriortosubmissionofrecommendationtotheBoardforapprovaloft
heaudited
financialstatem
entsoftheGroupandthe
Company.
........................
......................................
...
Mr.GarthKiddo
e
Chairman
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Com
pensationCo
mmitteeRep
ort
TheJama
icaStockExchan
geandItsSubsidiaries
TheCompensa
tionCommitteeoftheJS
Eismadeupexclusively
ofnon-executivedirectorsandischairedbytheChairmanof
theBoardMr.C
urtisMartin.Othermemb
ersofthecommitteeare:
Mr.GarthKiddoe
Mr.DonovanPerkins
MissHilaryPhillipsQ.C.and
Mr.MarkCroskery
Thecommittee
'smandateistomake
recommendationsontheCompany'sframework
ofexecutiveremunera
tion.The
CommitteereviewsandapprovescorporategoalsinrelationtotheCEO'scompensation;e
valuatestheCEO'sperfo
rmancein
lightofthecom
pany'sgoalsandobjectivesandmakesrecomm
endationstotheBoardwithrespecttoexecutive
andnon-
executivecomp
ensation.
Directors'fee,whicharenormallypaid
tonon-ExecutiveMemb
ersoftheCompanytota
led$6.04M,thisfeehasnotbeen
increasedforth
e2008period.
--------------------
---------------------
Mr.CurtisMartin(Chairman)
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TheJSEGROUP
2008Management'sDiscussionandA
nalysis
TheManagement'sDiscussionandAn
alysis(MD&A)oftheJamaicaStockExchange
(JSE)Group's
(comprising
the
JamaicaStock
ExchangeandtheJama
icaCentralSecuritiesD
epository)financialcond
itionandresultsofitsoperationis
providedtoena
blestakeholderstoassessthefinancialhealth,materialchangesandtheresultsofouroperationfo
rtheyear
endedDecember31,2008.Itprovidesin
formationonourliquidity
andcapitalresourcesan
dgivesacomparativeex
amination
ofpreviousyea
r'sperformanceversus
thecurrentyearunderreview.TheMD&Ashou
ldbereadinconjunctionwithour
AuditedFinanc
ialResultsandmustbe
consideredascomplem
entaryinformationtotha
twhichisprovidedinth
eaudited
resultsandthenotestothefinancialstate
ments.
TheJSE,which
completeditsdemutualizationprocessin2007,floatedVariablePreferenceSharesinthemarketin
May2008
andwaslisted
onitsownExchangeon
June30,2008.Thissignaledanewerainthe
Exchange'soperationstartingthe
processofamo
vetowardsgreaterpublicownershipoftheJamaicaStockExchange.Theprocesshasledtonew
lineitems
suchasdividen
dpaymentsforbothpreferenceshareholdersandordinaryshareholders,
whicharereflectedinou
rfinancial
statements.
Forfurtherinformationandinkeepingw
iththeJSEListingRequirement,financialinform
ationisalsoavailableontheJSE
Website
.
www.ja
mstockex.com
ExecutiveS
ummaryofVision,
StrategiesandPrio
rities
OurVision:
T
obeamongtheleadings
tockexchangeandsecu
ritiesdepositorywithinth
eCaribbeanRegion;pro
vidingthe
bestoperatinge
lectronicallytradingandsettlementplatformsofferingawiderangeofprodu
ctsandservice.
OurPriorities:
Grow&
Innovate
Weplantocontinuetodevelopproductsandservicesinresponsetotheneedsof
themarketbyworkingcloselywith
market
playerstobroadenthe
servicesoffered,improveproductdeliveryand
marketparticipation.Throughthis
approa
ch,weintendtoaggressivelycompeteformarkets
hareofthesecuritiesmarket.
Integra
te/Network
Inordertoreapeconomiesofscale,tofurtherimproveo
urrevenuebaseandtoprovideforourclientsad
iversityof
securities,weintendtopursueth
eintegration/networking
oftheExchangeswithintheregion.
IncreaseListings
TheJSEseekstoencouragecompaniestolistontheJSE
MainMarketandsoonto
belaunchedJuniorMark
etinorder
toimprovetransactionsonthem
arket,providechoiceforinvestorsandultimately
increasethereturnonin
vestment
fortheGroup.ItisalsoourintentiontomarkettheJCSD,topromoteanintegratedandcompletesuiteofpro
ductsand
service
stothefinancialcommun
ity.
MarketConditionsandOutlook
RegionalandG
lobalCapitalMarketsh
aveexperiencedseverevolatilityin2008duetotheglobaleconomicc
risis.The
governmentandtheBankofJamaicahaverespondedbyeffectingmeasurestoaddress
theimpactonJamaica.Measures
suchastheincr
easeininterestrateshav
enegativelyaffectedthe
StockExchangeasinves
torsseektofindthehighestreturns
oninvestment.
Thefallininvestorconfid
enceinthemarketwasa
lsobroughtonbythedec
linegloballyinthecapital
markets.
Ournormalope
ratingrevenue,whichdo
esnotincludelargeone
offblocktransactionsduetoactivitiessuchasme
rgersand
acquisitions,arehighlydependentupon
thelevelofmarketactivitiesonourexchange.T
heseactivitiesincludevolumeand
valuetraded,numberoftransactions,marketcapitalizationofthe
securitiesandlistingontheExchange.WhiletheExchange
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benefittedinpa
rtthroughlistingsofmain
lypreferencesharesand
themajortransactionin
LascellesdeMercadoin
2008,this
typeofwindfallmaynotberepeatedinthenearfuture.Itisfairtosaythatthecontractionoftheeconomywillhavean
impacton
theperformanc
eofthemarketandthis
condition,ifnotimproved,mayresultindecline
inrevenuesandnetpr
ofitofthe
companyforthe
ensuingyear.
Thoughweface
thesechallengingeconomicandmarketconditio
nsinthenearterm,webelievethatgiventhemeasuresthat
arebeingtaken
byworldleadersincludin
gourowngovernment,thatinthemediumterm,th
emarketwillrebound.Inaddition,
webelievethatoverthelongterm,ex
changesanddepositorieswillbecomeevenmoreimportantinprovidin
ggreater
transparencyfo
rcapitalmarketactivities
,clearingandsettlementoftransactionsandwillb
eseenastheavenueof
choicefor
capitalformationandsustainablegrowth.
(TheMarketCo
nditionsandOutlooksectionabovecontainscertainforward-lookingstatements)
MarketOperations&Trading
Overthe250tradingdaysin2008,total
volumeofordinaryunits
tradedamountedto2.29billionvaluedat$24.38
billion.In
comparisonto2
007,thiswasanincreaseinvolumeof41.39millio
nor1.84%andadecreaseof$1.56billionor6.03%invalue
traded.Thetota
lnumberofordinarytran
sactionsfor2008was30
,312,adecreaseof8,284or21.46%whencompa
redtothe
previousyear.
Thetotalnumberofsharestradedinvolumeand
valuefortheyearwas2
.95billionunitsand$67.03billion,
respectively.Thisincludedtheblockmarketactivitywhichhadvolumetradedof657million
unitsatavalueof$42.65
billion.
In2008,marketcapitalizationdecreasedbyover$279.4billiono
r31.8%tocloseat$597.28billion.
2008Mana
gement'sDiscus
sionandAnalysis(Contd)
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Allthreeindice
sexperienceddeclines
in2008whencomparedtothe2007closingindices;theJSEIndexde
clinedby
27,816.03pointstocloseat80,152.03points,theAllJamaican
CompositeIndexdeclinedby32,787.93pointstocloseat
73,994.93pointsandtheJSESelectInde
xdeclinedby944.23pointstocloseat1,984.74po
ints.
Theperformanceofthemarketfor2008wasalsocapturedin
theadvance/declineratioandcapitalappreciation.The
advance/declineratioindicatedthatatotalof8stocksadvanceda
nd28declined,whilenostockregisteredunchang
edprices.
For2008,2com
paniesexperiencedpriceappreciationofmorethan100%fromthe8stocksthathadadvancedduringthe
year.Thetable
below,showsthetopadv
ancersanddeclinersfor2008.
TopAdvancersandDeclinersfor200
8
WINNERS
%
LOSERS
%
CiboneyLimited
400.0
0%
SaladaFoods
195.4
5%
PulseInvestm
ents
100.0
0%
PalaceAmus
ement
93.9
6%
PegasusHotel
59.6
2%
MobayIceCompany
51.5
2%
SeprodLimit
ed
26.7
8%
GuardianHo
ldingsLimited
10.3
4%
GleanerCom
pany
59.7
7%
CaribbeanC
ement
59.4
9%
MayberryIn
vestments
59.1
8%
PanJamInv
estments
50.0
0%
CarrerasLim
ited
49.28%
Desnoes&Geddes
42.14%
PanCaribbe
anFin.Services
40.00%
GraceKenne
dyLimited
39.16%
FirstJamaicaInvestments
39.02%
Hardware&
Lumber
37.50%
2008Mana
gement'sDiscus
sionandAnalysis(Contd)
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FiveYearGrap
hicallyRepresentation
ofkeymarketindicato
rs.
2008Mana
gement'sDiscus
sionandAnalysi
s(Contd)
*VolumesandValuest
radedincludeBlockTransactio
ns
2
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OverviewoftheBusiness
Wearelicense
dbytheFinancialServ
icesCommissiontooperateboththeStockEx
changeandtheJamaic
aCentral
SecuritiesDepository,thelatterbeinga
subsidiaryoftheJSE.W
eoperate,fullyelectron
ictradingandsettlementplatform.
Weboastthem
ostlistingsofequitysecu
ritieswithintheEnglishS
peakingCaribbean.
Wecur
rentlyhave45listedcom
paniescomprisedofthirty-nine(39)OrdinarySe
curities,nineteen(19)P
reference
SecuritiesandNine(9)USDd
enominatedsecurities.
TradingactivitiesareconcentratedintheOrd
inaryand
Prefere
nceShares.
TheJSEmaintainsthreemainindices:
(i)T
heJSEMarketIndex
(ii)TheJSEAllJamaicanC
omposite
(iii)
TheJSESelect
TheJSEMainIndexisamarket-
weightedindexcomprisingordinarysharesofalllistedcompanies.TheAllJamaican
Compo
siteIndexmeasurestheperformanceofJamaican
Companiesonly,whiletheJSESelectIndexmea
suresthe
perform
anceoftheJSE's15mo
stliquidsecurities.
TheJSEiscurrentlydeveloping
aJuniorMarketforsmallandmediumsizedcom
panieswhowishtoraise
between
$50millionand$500millionvia
themarketandwhosestatedcapitalwillnotexceed$500million.Itisa
nexciting
proposition,whichhasthefullsu
pportofthegovernmentofJamaica.ThesupportincludestheapprovalbyCabinetof
atotalo
ften(10)yearsholidayonstatutoryearningofthes
ecompanies.
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gement'sDiscus
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24
NetSurplus
TheNetSurplusoftheJSEGrou
pfortheyear2008of$2
07.7millionshowedanincreaseof$163.59millionoverthe
previou
syear.IncomefromOp
erationsof$470.3millio
nandInvestmentof$9
1.03millionwerehigherthanthe
previou
syearby128.4%and
160.8%respectively.
Surplu
s&EarningsPerShare
Surplus
derivedfromOperationsdistributablewas$173.59millionor$6.19perc
ommonsharefor2008compared
withsurplusderivedfromOperationdistributablefor2007of$18.95millionor$0.68perstockunitfor2007.The
Compa
nyissued27,500,000bonussharesin2008toreflectatotalnumberofsharesnowinissueof28,050,000.This
isconsistentwiththefinalproces
sofdemutualization,whichresultedintheconvers
ionofseatstoshares.
Duetothelargewindfallgainfro
mtheLascellesdeMercado'sacquisitionbyCLS
piritsin2008,theSurplu
sderived
fromOperationandtheconsequ
entearningspershare,th
eperformancefor2008outstrippedthatof2007.
Asimilar
perform
anceisnotexpectedfor
2009especiallyinlightofthedownturnintheeconomy,whichhasaffected
thestock
market.
YearEndedDe
cember31,2008Comp
aredwithYearEndedDecember31,2007
Revenue
O
Themajorearningsofth
eGroupisfromCessRe
venuebutwiththeJSEG
roupsstrategyofdiversificationof
itsrevenuestreams,Incomefromseminars,pu
blicationandotherservicessuchasmarketdatasaleare
growingincomesources
.
O
Thefollowinggraphsprovideavisualrepresen
tationofthecorebusinessoftheJSEGroup.W
ederive
incomeprimarilyfromtradingandclearing,listing
fees,investmentandotherrelatedactivities.
Reven
ueforthegroupfor2007and2008
$
200
8
$
2
007
Cess
260,273,35
7
110,259,983
FeeIncome
AnnualListing
36,084,82
3
32,726,700
InitialListing
3,651,50
0
1,676,700
SupplementaryListing
699,64
2
389,091
Members&Attorney
17,50
0
12,500
Transaction
111,428,42
2
17,947,404
Mainte
nance
1,400,65
0
1,459,515
TradeD
ata
2,974,77
9
2,961,478
Registr
ar
4,409,73
2
3,682,287
Trustee
1,144,95
2
MembershipFee
1,124,00
0
1,639,800
OtherO
peratingIncome
Region
alConference
13,255,00
0
11,628,000
OtherIncome
33,806,00
0
21,506,000
Investm
entIncome
91,027,00
0
34,908,000
TOTAL
561,297,35
7
240,797,458
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gement'sDiscus
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TheGroupisorganizedintofourmainbusinesssegments,namely:
(a)
Exchangeoperationswhichdealwiththe
operationsandregulationoftheexchange.
(b)
DepositoryServiceswhichisinvolvedwiththetransferringandholdingofsecurities,shares,stocks
andbonds.
(c)
InvestmentOth
erIncomederivedfrominvestingactivitiesoftheG
roup.
(d)
Other-Trustee
custodianship,compan
ymanagementand
otheractivities.Trustee
Services
representthelatestadditiontothetypesofservicesoffered.We
believethisisagrowtha
reagiven
thesynergiestobederivedfromthede
positoryoperationandtheincreaseindemandfortrustee
serviceswithinJamaicaandtheCaribbeanregion.
Expend
iture
Expend
iturein2008of$302.3m
illionwashigherthanth
e$212.8millionof2007.Thisrepresenteda42%
increase
over20
07andwasdueprimarily
totheincreaseinstaffc
osts,advertisingandpro
motionandsecuritiesco
mmission
fees.In
flationrateof16.8%also
negativelyaffectedexpenditure.
O
StaffCosts
D
uring2008,theGroupim
plementedsomeoftherecommendationsmadeb
yaconsultingfirmhiredtoconduct
b
othaManpowerAuditan
daJobEvaluationandCompensationReviewAudit.Thissignificantlycontributedto
th
emovementinstaffcos
tsfrom$86.5min2007to$115.2Min2008representinganincreaseof33
.2%
.The
consultantsreviewalsohelpedinequippingexecut
ivestobetteraligncompe
nsationtoperformance.
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A
dvertising&Promotion
C
riticaltothegrowthandd
evelopmentoftheGroup
istheeducationofbothinvestorsandlistedcompaniesand
potentiallistedcompanies.Asadirectresultofours
trategytogrowtheseareasfromthesingledigitinv
olvement
ofinvestorsinthestock
market,theGroupisnowinanaggressivemo
detoimpartthemessa
geofthe
im
portanceofthecapitalm
arketandthebenefitstobederivedbymarketplay
ers.
S
ecuritiesCommissionFee
T
hisisafunctionofthelevelofCessRevenueearned.TheExchangeLevies0.393%ofthevalueofthe
tr
ansactionandtheFinancialServicesCommissio
nearns0.08%ofthisam
ount.In2008theCess
Revenue
w
as$260.3millioncompa
redto
$110.3millionin2007,withcorrespondingSecuritiesCommissionFeeof
$59,178millionand$24million.
O O
R
ationalizationofExpenditure
TheExchangecontinues
torelentlesslypursuea
courseofexpenserationalization;ensuringtha
tmonies
expendedprovidethehigh
estreturnoninvestment.
R
evenueReserves
TheGroupsRevenueReservesdecreasedin2008
to$272.3millionfrom$3
73.8in2007duetothedeclaration
ofandprovisionfordividendof$220million.Thisrepresentsthefirstdeclarationofdividendpa
ymentto
O
rdinaryShareholderssin
cetheinceptionoftheJamaicaStockExchange.Paymentwhichwillbe
madeto
shareholdersonrecordsa
satDecember22,representsa$7.84perstock
unitandispayableonJ
anuary2,
2009.In2008,theCompa
nyalsofinalizeditsDividendPolicythatallowstheGrouptopaydividend
annually
basedonthefollowingconditions:
T
heBoardofDirectorsof
theJamaicaStockExchangeintendstodistribute
asanannualdividendto
Ordinary
Stockholdersnotlessthan
20%oftheannualnetp
rofitoftheGroup,inrespecttoprofit,netofextra
-ordinary
item,oftheprioryear.The
dividendpaymentishoweversubjecttotheneeds
oftheCompanyforreinv
estments
ofprofittofacilitategrowth,expansionanddevelopm
ent.
TheDividendPolicyissubjecttoreview,fromtimeto
time,bytheCompany'sBoard.
OO
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gement'sDiscus
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FiveYearFinancialHighlights
FiveYearFinancialHighlightsshowsthe
steepriseinrevenuein2008afterconsecutivedeclinesinthetwoyearsp
rior.Net
ProfitAfterTaximprovedin2008over20
07andin2006whichreflectedthesignificantwriteoffoftheFixedIncome
Software
Development.R
efertochartandgraphsb
elow:
200
4
2005
2006
200
7
2008
Revenue
($000)
219,39
5
313,590
294,515
240,79
7
561,297
NetProfit
($000)
109,00
1
114,213
8,213
44,11
6
207,703
RiskManagement
TheGro
up'soverallriskmanagementstrategiesremainunchangedfrom2007.
Inv
estments
Management,throughtheG
roup'sInvestmentCommittee,continuestoreviewitsinvestmentportfoliosinline
with
theInvestmentsPolicyGuidelines,whichareals
oreviewedbytheAudit&
FinanceCommitteeoftheBoard.
The
InvestmentManagementCommitteereceivesan
dreviewsdataoncurren
tmarketconditionsandeconomic
outlook;reviewsvariousriskreportssubmittedincludingfairvalue,interestrisk,liquidityrisk,currencyriskand
marketrisk.Meetingsareheldataminimumonamonthlybasis.
The
Company'sprincipalbusinessactivitiesrelyontradingactivitiesintheMarketandbynatureares
ubjectto
variousrisksincludingsystemsdowntime,whichmay
resultinlossofproductiv
ity,revenueandconfidenceinthe
mar
ket.Consequently,there
areredundancies,data
protectionmeasures,s
ecuritymeasures,andp
oliciesin
plac
etoensureamoreresilientandsecuresystem,w
hichwouldhave100%availabilityduringbusinesshours.
ITrisksarealsominimizedthroughseparationofduties,requisitetraining,anda
dherencetoimplementedpolices,
internalaudits,a
continuing
review
and
upd
ate
ofpolicies
and
close
managemento
versight.
OtherO
perationalRiskMitigationStrategies
ITR
iskMitigationStrategies
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gement'sDiscus
sionandAnalysis(Contd)
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The
JSEhasadoptedtheITG
overnanceFramework,Cobit4.1,whichensures
thatITandbusinessstrategiesare
alignedtoachievethefollowingobjectives:
U
seofITtoenabletheorganizationbyexploiting
opportunitiesandmaxim
izingbenefits;
R
esponsibleuseofITres
ources;
A
ppropriatemanagementofITrelatedrisks
GroupMediumandLongTermS
trategies
Duetothegloba
lfinancialmeltdown,the
negativeimpactoftheunregulatedschemesontheJamaicaneconomy,thecurrent
ighinterestrateregimeandthereduc
tionofinvestorconfidenceinthemarket,theg
roupisfacedwiththes
ignificant
hallengeofattractingnewentrantstoth
emarketandretainingc
urrentmarketplayers.Marketuncertaintieshavecreated
ewchallenges
butwithinthemnewopportunities.Webelievetha
tallourstakeholdershavecometoappreciatetheneedfor
reatermarketinformation,education,re
gulationandproductdiversification.Tothisend,th
efocuswillbeonthecontinuation
fthefollowinga
ctivities:
Increasedmarketeducationalac
tivitiesthroughcompaniesandinvestoroutreach,schoolprogrammeandtrainingof
marketintermediaries.
CreationofJuniorMarketfortheSmall&MediumSizedCo
mpanies.
Expans
ionandGrowthofRegistrarandTrusteeServices.
TheInte
grationthroughNetwork
ofourregionalexchange
s.
UtilizationofInformationTechnologytodrivethegrowth&developmentoftheGroup.
Theco
ntinuedfocusedthroug
htheJSE
independen
tRegulatoryandMark
etOversightDivisiono
fMarket
SurveillanceandMemberDeale
rInspection.Theimplem
entationoftheStateofth
eArtSurveillanceSystemin2009
willbea
welcomedadditiontotheslateoftoolsusedbyth
isdivision.Moreproduct
offeringthroughthesale
ofmarket
data,de
velopmentofandmainte
nanceofnewindicesand
derivativeproducts.
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gement'sDiscus
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GENERALMANAGER'SREPORT-
JSE
DMrs.M
arleneStreetForrest
GeneralManager
Jamaic
aStockExchange
espitetheturbulentglobalconditio
nsin2008,theJamaicaStock
Exchange(JSE)completedtheyearonaveryprofitable
notedue
primarilyto
theincomeearnedfrom
facilitatingthetransactionofthe
Lascelles/CLSpiritson
the
ExchangeandtheJamaica
Central
SecuritiesD
epository(JCSD).Thiswasthelargesttransactionofthis
natureinJamaicaandassuredtheExchang
eamorethan100%
increasein
Cessrevenuedespitemarketperformancew
hichwasotherwiseslug
gishand
whichwouldhavebe
en,otherthanforthistra
nsaction,worsethanthe
previous
year.Intheareaof
feeincome,theGroup
alsoperformedbetterthanwas
projectedduetoth
esametransaction,whichsaw
pledgefeeincreasing
significantlyoverthepreviousyear.TheTrusteeServiceLtd,anewsub
sidiaryof
theJCSDalsobenefittedfromtheLascelles/CLSpiritstransactionaswellasfrom
othernewcontractss
igned.
Thegeneraluncertaintiesintheeconomythatdogged2007werestillpresentin
2008.However,this
didnotdetertheStock
Exchangefromachievingsome
growth.Therewere
ninenew
listingson
theExchangecomprisedofsix
preferencesharesan
dthreeordinaryshareslistingswhichisthemostinover15
years.ThisincludedtheJamaicaStockExcha
ngePreferenceShare,w
hichwas
oversubscribed.
Withtheexceptionofourlargeblocktransactions,allmarketindicators
declined
over2007anditisunlikelythatwewillseeareboundingofthemarke
tin2009.
Weconsidereditopportuneandweutilizedthistimein2008todeveloponthe
internalcompetenciesandefficienciesin
theGroupthroughtraining,job
enlargement,improv
ementonpoliciesandproceduresandconcentrationon
newproductideasan
ddevelopment.
TheJuniorStockM
arketdevelopmentwas
givenaboostin2008
withthe
approvalbyCabinet
ofthetaxconcession.Wehavepursueddevelo
pmentof
the
Caribbean
Exc
hange
Network
though
we
have
encounteredsome
challenge.Wecontinuedtopursuemanyothe
rareasoffocusforwhich
progress
havebeenachieved.
TheExchangecontin
uestolistentoitsstakeholdersandhasinfactcom
mittedto
workingwithourlistedcompaniesandinvestorstobringaboutmarketgrowth
anddevelopment.A
saresult,wehavebe
enabletoaddresssom
eofthe
concernsraisedbyth
emandthroughquarterlyface-to-facemeetings,weintend
toresolvemattersthatwilllikelyaffectthecompaniesandthegrow
thofour
market.
EXTERNALFACTORS
Theglobaleconomic
crisis,thehighinterest
ratepolicytowardsthee
ndofthe
yearandtheeffecto
fthefallofmanyunregulatedschemeshavealln
egatively
impactedonthemar
ketin2009.Allthesefac
torshaveplayedonthepsycheof
investors,manyof
whom
havesoughta
moreconservativeapp
roachto
investmentsorcashe
dinontheirinvestments
inequitytomeetcashflo
wneeds.
Weexpectthatthese
conditionswillpersistsfo
rmostof2009.
(Continued)
OP
InhaWw
etra
Wwh
wh
Ma
Ou
Ex
ne
ST
Th
co
ma
or
fos
TH
Ou
imtha
on
Ev
me
Th
ma
JS
On
DE
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GENERA
LMANAGER'SREPORT-JSE(Contd)
PPORTUNITE
S
spiteofthefra
gileeconomicenvironme
nt,therearepossibilities.Wehaveachievedmanyfirstsin2008.Manynew
products
avebeenlaunc
hedin2008,whichwewillcompletein2009,andm
anywhichwerestartedin2007havenowbeenco
mpleted.
Wesuccessfully
launchedinSeptember,
theInvestorEducationW
eek,whichwasacollabo
rativeeffortwithourregu
lator.The
eekofactivitiesmetourobjectivesofexposingnewinvestorstothemarket.TheStockMarketGame-thesimulatedelectronic
adingandportfoliomanagementgamea
imedatimprovingmarke
tunderstanding,wasalsolaunchedwithintheyear.
Wearecurrently
workingonthedevelopm
entofnewindices,deriv
ativetradingandotherex
pandedserviceswithintheGroup,
hichwebelievewillenhancethecapita
lmarketexperience.TheGrouphasseenanincreaseofover42%intheareasin
hichwehavediversifiedandweexpec
tthattheseareaswillfac
torinamoresignificant
wayinensuingyears.Thesaleof
arketDataisa
keyarea,inwhichwehavestartedtomakesomein-roadsandweplantofu
rtherpursuenextyear.
urmajorachievementsin2008areth
eresultsoftheinvestm
entandcommitmentwe
havemadeinensuringthatthe
xchangehasa
ndoffersleadingedgetechnologytoourstakeho
lders.TheGroupintendstocontinuetogrowanddevelop
ewproductasb
ysodoingwewillbeinapositiontoofferyoualow
ercostofprovidingexcellentservices.
TAYINGTHEC
OURSE
hisyear,desp
itethesignificantnetoperatingincomerealized
,hasbeenadifficultoneanditisunclearwhe
nmarket
onditionswillim
prove.Ourvisionremainsfocusedtobetheleadingexchangewithinthe
Caribbean,toimprovethecapital
arketbycreatingproductsthatwillenha
nceinvestmentexperien
ceandencouragenewc
ompaniestolistoneithertheMain
rtheJuniorExchange.Whiletheyearh
asbeenchallengingwecontinuetohavesuccessesinkeepingwithourprioritiesof
steringgrowth
anddevelopmentofthem
arketbyprovidinganeff
icientandtransparentma
rketplace.
HEMARKET
urtradingand
settlementplatformsre
mainedrobustin2008.
Weexperiencednosign
ificantdowntimeandh
aveeven
mproveduponthepreviousyear'sperformance.Despitethis,wec
ontinuetoexaminetheofferingswithinthemarket
toensure
attheplatform
sonwhichweoperateareonparwithourmostde
velopedcontemporaries
andwillprovidethehighestreturn
ninvestment.
veryefforttog
rapplewithanynegativeperceptioninthemark
etcontinues.ThiswillseetheExchangelookingatother
ethodssuchastheAveragePricetodeterminethemarketpriceforthecloseofday.
heExchangea
lsoconsidersitnecessarytogrowthemarketthro
ughtheadditionofnewm
emberdealersanddepe
ndenton
arketcondition
s,thiscouldberealizedin2009withtheadditionofatleastonenewmembe
rdealer.
SECORPORA
TEACTIVITIESANDNE
WINITIATIVES
ngoingActivities
UpgradesandEnhancementoftradingplatformforefficien
tmarketdelivery
Website
Enhancementincluding
StockMarketGamegearedatmarketeducationathighschool&tertiarylev
el
Stafftraining
Continu
edDevelopmentofintern
alprocessesforCXN
EPARTMENTALHIGHLIGHTS
MARKETINGACTIVITIES
Inkeeping
withtheorganization'sgoalsandobjectivesourMarketingDepartmentw
orkedassiduouslyorgan
izingand
hostingse
veraleventsandimplementedanumberofprojectsduringtheyeartoincreaseourcustomerbasean
dtohave
greaterin
teractionwithourstake
holders.InachievingtheseobjectivestheJSEwasengagedinthe
following
programm
es:
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GENERA
LMANAGER'SREPORT-JSE(Contd)
(i)
HighSchoolEducationP
rogramme
ThisisgearedtowardseducatingHighSchoolStudentsontheStockMarketandhowtoinvestinthemarket.
Thisprogrammecontinuestomakestrideswithatotalof178HighSchools
visitingtheExchange,settingthe
stageforcontinuousmarke
teducation.
(ii)
NationalInvestorEducat
ionWeek
Therewere730studentsinattendanceattheNationalInvestorEducationWeekseminar,whichwa
sgeared
to
wardsstudents.
(iii)
Teacher'sOutreachProg
ramme:
TheJSEintroducedanOutreachProgrammeforteachersfromvariousschoolsacrosstheisland.Twelve
schoolsparticipatedintheprogramme.
(iv)
TheJSE'sPublicInvestorOutreachProgramme:
TherewerethreePublicIn
vestorEducationOutrea
chsessions.ThesewereheldinKingston,Santa
Cruzand
O
choRios.
(v)
FacetoFace:
TheJSEnotonlydialogue
dwithitsinvestorsandp
otentialinvestors,butals
o,theirkeystakeholders
,suchas
th
elistedcompanies,toen
surethatallchannelsof
communicationareopen
.Consequently,theJSE
engaged
th
elistedcompanieseachquarterin2008.
(vi)
BestPractices:
In
anefforttoassistplaye
rsintheindustrytoope
rateatinternationalstandardstheJSElauncheditsBest
PracticesAwardforListedCompaniesandStock
Brokeragesin2004.Herecompaniesareawardedfor
outstandingperformances
inseveralcategories,ra
ngingfrom:BestAnnual
ReporttoBestInvestorR
elations.
ThePSOJCorporateGove
rnanceawardwasadded
in2008.
(vii)
JSE'sCapitalMarket&In
vestmentConference:
Theyear2008sawtheJS
Econtinuingitsvisionofbringingpersonsnoton
lyfromacrosstheCaribbean,but
fromEuropeandNorthAmericatogether,toex
changeideasandnetw
orkinanefforttocontinuethe
developmentoftheCapitalMarket.TheJSEtooktheopportunitytohonourDr.RichardBernalforhis
outstandingcontributionto
Caricom.
(viii)
W
orkshops:
TheJSEin2008hostedas
eriesofworkshops.Theobjectiveoftheseworksh
opswastoexposestakeholdersin
th
emarkettointernationa
lbestpracticesinthecapitalmarket.Atotalof
six(6)workshopswere
heldand
coveredareassuchasLea
dership,DerivativesandCommunicatinginaCrisis.
Theeffortsthatwehavep
utintomarketoutreachprogrammesandworksh
opscontinuetoreaptremendous
benefits.Thisisevidencedfromthefactthatev
enthoughmostcompanieshadcontractedexp
enditure,
employersarenotaverse
totheiremployeesparticipatinginourworkshops.Wehaveflaggedthis
areafor
growthinthemediumtolon
gterm.
TheJSEthroughitsComm
unicationandMarketing
Departmentiscommitte
dtotheprocessofdialog
uingand
educatingalltheplayersin
themarkettoallowfora
lltooperateatinternatio
nalstandardsandwillco
ntinueits
efforttogrowthecapitalma
rketforfuturegeneration
s.
INTERNA
LAUDIT
Towardstheendoftheyearweou
tsourcedourinternalauditfunctionstoPriceWat
erhouseCoopersasweareofthe
viewthatthismovewouldfurtherstrengthenourinternalcontrolsandimproveonourp
rocedures.
INFORMA
TIONTECHNOLOGY
TheJSEc
ontinuestoimplementan
dutilizeinformationsyste
msthatsupportandenhanceitsstrategicobjectives.
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GENERA
LMANAGER'SREPORT-JSE(Contd)
(i)
In
frastructure
Since2001,theJSEand
itssubsidiary(TheJCSD)havebeenutilizinganelectronictrading,clearingand
se
ttlementplatform.Broke
rsandotherexternaluse
rsaccessthesystemsviaasecuredandrobustW
ideArea
Network(WAN).Additiona
lly,aspartofitsBusinessContinuitystrategy,th
eJSEimplementedah
otsiteto
provideredundancyforitscoresystems(Trading,C
learingandSettlement).AstheJSEcontinuestoe
xpandits
se
rvices,theinfrastructure
iscontinuouslyupgradedtotakeadvantageofthe
emergingtrendsinordertofoster
growththroughknowledge
andinnovation.Therefore,inourquesttostayabreastoftechnology,weco
ntinueto
upgradeoursystems.
(ii)
W
ebsite
TheJSE'sWebsiteisthe
'faceoftheExchange'.Thewebsitecontinuestobeaveryvaluableres
ourcefor
informationtoinvestors,fin
ancialanalysts,researchers,students,andother
visitorstothesite.Some
valuable
re
sourcesavailableonthe
sitearedailyandhistoricalstockmarketinform
ation,tradesheetsandcompany
newsviasubscription,ch
artingcapabilities,financialstatements,inform
ationonListedCompa
niesand
m
emberfirms,membershipsubscription,stockmar
ketgame,portfoliomana
ger,onlinestatementaccess,and
archivedtradesheetsfrom
1969.Statisticsfor2008
(seetablebelow)indica
tethattherewere608,00
0visitors
to
thesite,includingstude
ntsfromhighschoolswh
ohaveshowngreatinte
restsincethelaunchoftheStock
M
arketGame.
Month
Unique
visitors
Numberof
vis
its
Pages
Hits
Jan-08
19,528
53,349
1,615,049
3,902,102
Feb-08
18,620
50,987
1,570,555
3,583,721
Mar-08
19,209
51,139
1,331,124
2,775,975
Apr-08
18,515
50,451
1,356,414
3,051,036
May-08
17,919
49,147
1,428,524
3,005,102
Jun-08
18,983
50,904
1,692,433
4,227,561
Jul-08
18,007
49,351
2,007,007
3,797,926
Aug-08
15,480
42,084
1,150,217
2,535,721
Sep-08
16,519
46,128
1,394,698
2,767,522
Oct-08
20,007
55,272
1,928,302
4,448,560
Nov-08
18,759
53,029
1,712,669
3,298,657
Dec-08
19,324
56,159
1,558,011
2,900,959
Total
220,870
608,000
18,745,003
40,294,842
(iii)
DataServices
In
formationdissemination
iscrucialinkeepinginvestorsabreastofthe
activitiesontheStock
Market.
Consequently,theJSEen
suresthataccurateand
qualityinformationisma
deavailabletoitsclient'sthrough
so
urcessuchasBloombergwhoutilizesaMarketDataFeedprovidedbytheJSE.Otherproductof
thisdata
fe
edcanbeseenoncablestationsandwebsites
ofclientswhosubscrib
etothistechnology.In
2008we
expandedthisservicewhic
hwillbecome,infutureyears,akeysourceofincome.
(iv)
CaribbeanExchangesNe
twork
GiventheimpendingCarib
beanExchangesNetwo
rk(CXN),theJSE'stelecommunicationinfrastruc
turewas
upgradedtofacilitateseamless'any-to-any'connectivitybetweenthebrokersinJamaicaandthe
Hubsin
BarbadosandTrinidad.Ad
ditionally,thetrading,cle
aringandsettlementsystemswillbeupgradedto
facilitate
tradingandsettlingtradesdoneontheCXNmarket.
(v)
DevelopmentMarketSurveillanceSystem
W
iththeseparationofthe
commercialarmfromth
eRegulatoryarmofthe
organizationandthesubsequent
cr
eationoftheRegulatoryMarketandOversightDiv
ision(RMOD),theJSEh
asidentifiedtheneedtod
evelopa
M
arketSurveillanceSystem,whichwillundoub
tedlyassisttheefficiencyoftheRMOD
inp
rotecting
stakeholders'interest.
2A
CO
We
Sch
Uni
stu
org
FO
200
edu
fac
act
res
We
res
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ProvidingAFair,Efficientand
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Market
JAMAICA
STOCK
EXCHANGE
008ANNUALRE
PORT
33
GENERA
LMANAGER'SREPORT-JSE(Contd)
HUMANR
ESOURCES
TheJamaicaStockExchangeisprivilegedtohaveaverydedicated,loyalandcommittedteam.Despitethech
allenges
thattheJSE/JCSDencounteredduringtheyear,wewereabletoovercomemostoftheseobstaclesthr
oughthe
exemplary
cooperationandresilien
tspiritofthestaffmembe
rs.Basedonthecompa
ny'sobjectivetohaveam
otivated
andprepa
redworkforce,amanpow
erauditwasconductedwhichresultedinsalaryre-classificationandjobevaluation
ofallpositionswithintheorganization.
Werecog
nizetheimportanceof
effectivelydevelopingourstaff,hencewefacilitatedandencouragede
mployee
developmentthroughtraininginC
orporateFinance,Secu
ritiesMarket,IFRS,Leadership,Derivatives,Re
alEstate
Investmen
tTrust(REIT)CommunicatinginaCrisisandalsointernalcross-training.
Additionally,theJSEcontinuesto
encouragestafftoadvancetheirprofessionalstatusthrough
ourEducationLoanFacility.
TheJSEinensuringthatwearea
'wellrounded'workforce
hadtheirfundayatSunsetBeachResort,MontegoBay.
Employee
swereplacedin'houses'namedafterpastCh
airmenoftheBoard(S
amms,BrownandLloy
d).The
camarade
rieandkeencompetitivenessoftheemployeeswasquiteintense,whichm
adeFunDay2008averyexciting
andmemo
rableone.
ORPORATES
OCIALRESPONSIBLIT
Y
emaintainedclosetieswithourcommunityandsupportedtheDenhamTownGoldenAgeandtheDenhamTownPrimary
hoolthroughourcorporatedonationsandstaffactivities.Weh
aveimprovedonoursch
olarshipsforbothstudentsofthe
iversityofthe
WestIndiesandUniversityofTechnologyandhavecontinuedtoprovide
workexperienceprogrammesfor
dentsfromUWI,UTECHandotherinstitutionsoflearning.Wea
realsocommittedtoUnitedWayandmanyotherc
haritable
ganizations.
ORECAST-20
09
th
09marksthe
Exchanges40Anniversaryinwhichweexpecttohavesomecelebratoryactivitiesgearedtoward
smarket
ucation.Itisa
lsoexpectedtobeachallengingyear.Buildingm
arketawarenessandthe
advantagesthatexistev
eninthe
eofanecono
micdownturnforbothin
vestorsandcurrentand
potentiallistedcompanieswillbethethrustofthe
Group's
ivitiesfor200
9.Wewillseeknewwa
ysofprovidingbetterservicetothemarketatalowercost.Wewillimproveonour
sponsetimeto
ourstakeholders.
eanticipateth
atwiththelaunchoftheJuniorMarketin2009,therewillbetremendousinterestfrommanyco
mpanies
sultinginafew
listings.Ourworkwillbethatofmarketeducationandassistancetopotentiallistedcompanies.
Anewexchangetradedfundmarket(ETF)
NewExchangeIndices
MarketDataMessagingServices
Listingo
fForeign/InternationalCompaniesthroughthepro
cessofAdvancedDepos
itReceipts
TheCar
ibbeanExchangeNetworkwhichreducestheexposuretoonlylocalstocks
OnlineA
ccessofClientAccounts
Many40
thAnniversaryActivities
eGrouppursuesseveralotherbusine
ssdevelopmentinitiative
s,whichinclude:
(Continued)
Iwis
able
and
time
Our
pers
man
bes
Ma
Ge
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8/9/2019 JSE 2008 Annual Report
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ProvidingAFair,Efficientand
TransparentStock
Market
JAMAICA
STOCK
EXCHANGE
2008ANNUALRE
PORT
34
GENERALMANAGER'SREPORT-JSE(Contd)
shtothankallourlistedcompanies,in
vestorsandothers,throughwhosecontinuedsupportandfeedbackwehavebeen
etocontinueourgrowthpath.Ourman
ysuccessfulmarketeducationprogrammessuchastheMarketAnalystCompetition
dBestPractic
eAwardsCompetitionwouldnotbepossiblewithoutthededi