STRATE THE CLEARING & SETTLEMENT & DEPOSITORY FOR ALL FINANCIAL INSTRUMENTS IN SOUTH

AFRICA

Punte del Este, Uruguay 27 October 2005

Monica SingerCEO- STRATE Ltd (S.A.)

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STRATE Overview Electronic clearing, settlement & depository services for equities listed on the JSE and

some unlisted companies, bonds & money market instruments (Mid 2006)

The Licensed Central Securities Depository for all financial instruments (excluding

derivatives and unit trusts) in South Africa

Electronic transfer of ownership using STRATE technology

Transfer of value via the Central Bank (SARB)

Beneficial Ownership download and other services to listed companies

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Vision

We are committed to be the trusted and

preferred centralised provider of products and

services which are accessible to, and create

value for, our current and future stakeholders.

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Volumes of transactions in Bonds as at end September 2005

▪ Redemptions for year ending 30 September 2005 = USD 16 billion

▪ Interest payments for year ending 30 September 2005 = USD 8.2 billion

▪ Exchange rate USD 1 =R6.00

2002 2003 2004 9 months 2005

Annual Volumes USD 1.8 trillion USD 1.64 trillion USD 1.29 trillion USD 0.95 trillion

Number of daily trades 1580 1423 1356 1297

Market Capitalisation USD 72.8 billion USD 86.8 billion USD 103.4 billion USD 109.6 billion

Liquidity 24.6X 18.9X 12.5X 11.5X

No of Instruments 274 331 384 465

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Volumes of transactions on Stock Exchange Listed Securities as at August 2005

2002 2003 2004 8 months 2005

Annual Volumes USD134 billion USD 125 billion USD 172 billion USD 129 billion

Number of daily trades 3.7 million 3.25 million 3.91 million 3.07 million

Market Capitalisation USD 264 billion USD 297 billion USD 428 billion USD 429 billion

Number of Listed Companies 472 426 403 389

USD 1 = R6.00

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Success in STRATE in chronological order

October 1996-project begins

November 1999 to 2001 pilot project with 14 listed companies into STRATE, 617companies to go

March to December 2001 all listed companies move into STRATE

August 2003 –merger with company that settles bond

Currently there are 389 listed companies listed on the Johannesburg Stock Exchange

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Shareholders of STRATE Ltd

Johannesburg Stock Exchange

41% 59%

ABSA BankNedcor BankStandard BankFirst Rand BankCitibank

41% 59%

STRATE Ltd

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Board Members• Chairman:

– Mervyn King

• Johannesburg Stock Exchange:– Russell Loubser – Bobby Johnston

• Banks:– Stuart Yates (FirstRand)– John Stathoulis (Standard Bank)

• Non Executive Independent Directors– Rick Cottrell– Sindi Zilwa– Raisibe Morathi– Heather Sonn– Annamarie van der Merwe– Leon Campher

• Executive Directors:– Monica Singer – CEO– Erna Solomon – COO

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Dematerialisation

Required in terms of the JSE Rules

Can be rematerialised but a penalty is charged

New listings do not require the issue of share certificates

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94.78%

5.22%

Dematerialised in STRATE

Dematerialisation of listed securities as at September 2005

Held by investors in certificated form

outside of STRATE

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Bonds dematerialised in STRATE as of March 2005

Total market capitalisation as at March 2004 R556 billion9%

25%

66%

Held outside of STRATE as block of securities

Immobilised under STRATE

Dematerialised under STRATE

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Message flow in South Africa

Client JSE member

Delivering CSDParticipant

Receiving CSD Participant

SETS

BDA

SAFIRESTransfer Secretary Registrar

SAMOS

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The electronic contractual and guaranteed settlement

No transaction has ever failed to settle in STRATE

All dividends for listed shares and interest for bonds have been paid to the investor on time.

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Key lessons learnt from the implementation of STRATE in South Africa

The implementation of an electronic clearing and settlement of financial instruments is of national interest, with efficiency the volumes increase

The brokers and the banks have to work together with the Central Bank in order to achieve the electronic delivery vs payment in Central Bank funds

The Central Bank should implement a Real Time Gross Settlement system for the cash settlements

The financial instruments should be dematerialised The technology is available. Do not reinvent the wheel Allow for the borrowing and lending of securities in order to

enable the settlement of trades on time Assign ISIN codes to all financial instruments.

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Current and Future Projects

Finalise implementation of settlement of Money Market

Instruments

Migrate the settlement of bonds to SAFIRES

Implement the Alternative Settlement Model (ASM)

Improved corporate action functionality

Settlement for unlisted companies

Settlement of trades of other African stock exchanges

Expand the newly acquired Registrar business

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Contact

For more information contact STRATE:

Telephone Number: + 27 11 759 5300 / 5311Fax Number: + 27 11 759 5500 Website: www.strate.co.za

Monica SingerE-mail: monicas@strate.co.za

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Thank You!

The South African Central Securities Depository

www.strate.co.za