INTRODUCING KAZAKHSTAN STOCK EXCHANGE INC. (KASE)

1. INTRODUCING KAZAKHSTANSTOCK EXCHANGE INC. (KASE) Relevant as of February 1, 2008

2. COEVAL WITH TENGE … KASE was established on November 17, 1993 under the name of Kazakh Interbank Currency Exchange – two days after Tenge (the new national currency of Kazakhstan) was introduced on November 15, 1993. Nowadays, November 15 is celebrated as the official "Day of Tenge". "Old" tenge (1993–2006) "New" tenge (since 2006)

3. YOUNG AND SINGLE … KASE is a commercial joint-stock company with 69 shareholders (as ofJanuary 31, 2008). The National Bank of the Republic of Kazakhstan is the largest shareholder. Other shareholders include: banks, brokerage firms, asset management companies, pension funds and other professional financial institutions. Voting method: one share – one vote.

4. YOUNG AND SINGLE … (2) Today KASE is the single universal financial exchange in Kazakhstan with brief but bright history: 1993– first trades with foreign currency (US dollars) 1995– first trades with T-bills 1996– first trades with derivatives (KZT/USD exchange rate futures) 1997– first trades with listed shares 1997– first trades with state blocks of shares 1997– first trades with non-listed corporate securities 1998– launching of "nego" deals system on KASE (instead of over-the-counter securities market )

5. YOUNG AND SINGLE … (3) 1998– first trades with eurobonds of Kazakhstan 1999– first trades with listed corporate bonds 1999– first trades with municipal bonds (since 2005 the issuance of these bonds is prohibited) 1999– launching of the "nego" repo market 2001– first trades with bonds of international financial organizations (IFO) 2001– launching of "automatic" repo market (the most massive and active sector of the KASE market) 2002– first trades with promissory notes 2003 – first trades with foreign T-bills (Russia 2028 & Russia 2030 )

6. YOUNG AND SINGLE … (4) 2006– first trades with foreign corporate bonds (JP Morgan and Merrill Lynch) 2006– IPO of KazMunayGas Exploration and Production shares with the use of KASE settlement system 2006– secondary distribution of KAZAKHMYS PLC (UK) shares with the use of KASE settlement system 2007– special trading floor of the Regional Financial Center of Almaty city was founded on the base of KASE (founded to attract foreign issuers and investors) 2007– launch of the new index on the share market – KASE Index, which continued the number series of KASE_Shares Index 2007– Commercialization of KASE

7. IMPRESSIVE DYNAMICS …

8. IMPRESSIVE DYNAMICS … (2)

9. UNIVERSAL EXCHANGE … Repo (money) market constitutes for 73.3% of total KASE turnover

10. UNIVERSAL EXCHANGE … (2) KASE serves the markets of: • "nego" and "automatic" repo with public and corporate securities • foreign currencies (US dollar, euro, russian rouble) • public securities of Kazakhstan issued by the National Bank, municipalities and Ministry of Finance (including international bonds of Kazakhstan) • IFO bonds and foreign T-bills • promissory notes • equities • corporate bonds …

11. VARIETY OF CORPORATE BONDS • "regular" domestic bonds (nominated in Tenge or foreign currencies, with discount or coupon, with fixed or floating coupon) • international bonds of Kazakhstani issuers • agency bonds (with the tax regime equal to the tax regime of T-bills) • infrastructural bonds (secured by the government guarantee) • bonds of foreign issuers (previously registered outside Kazakhstan) • soon: bonds of foreign issuers (registered in Kazakhstan)

12. DOMINATION OF REPO AND FOREX MARKETS KASE repo market is specially designed for domestic purposes – to satisfy the needs of local pension funds and banks in short-term money borrowing and lending. KASE foreign currencies market – the basic trading site for the NationalBank of the Republic of Kazakhstan to regulate the exchange rate of Tenge. KZT/USD: the KASE exchange rate today = official exchange rate tomorrow.

13. LISTED COMPANIES (by categories)

14. LISTED COMPANIES (in total)

15. MARKET CAPITALIZATION(USD bln)

16. LISTED COMPANIES (by structure) Global Industry Classification Standard (GICS) of S&P is used

17. "PURE" CORPORATE SECURITIES MARKET Total KASE turnover in January 2008 with shares –219.4USD m,with corporate bonds – 103.2USD m

18. "PURE" CORPORATE SECURITIES MARKET (2) In January 2008 average daily KASE turnover with shares – 11.0USD m,with corporate bonds – 5.2USD m

19. "PURE" CORPORATE SECURITIES MARKET (3) • The main problems are: • lack of free-float equities (the heritage of case-by-case privatization) • conservative policy of main domestic investors ("buy bonds and hold till maturity") • Nevertheless ..

20. CHAMPION GROWTH (in 2005–2007)

21. INVESTOR BASE … Institutional investors assets at the end of 2007reached108.5bnUSD, 88.3%of them are banks assets,8.8%– pension assets Principal indicatoris growth of unit investment funds assets (at the end of2006 –422mUSD)

22. ADVANCED TECHNOLOGIES KASE uses it’s own trading platform: • on-screen based electronic "Server –Client" system • remote access • electronic signature and electronic documents circulation • traffic encryption • on-line data saving Central Depository is the KASE subsidiary: • DVP • T+0 settlement basis

23. IN THE FUTURE … • Waiting for IPO of the largest Kazakhstan banks and producers (according to the Securities Law, at least 20% of the local shares being placed must be suggested at the domestic market for purchase) • Administrating the Special trading site of the Almaty Regional Financial Center (set-up to attract foreign issuers and investors) • Welcoming the new listing companies • Waiting for IFOs to place their bonds in Kazakhstan • Ready to introduce T+n settlement basis for the foreign operators (only for eqities) • Launching currency swap market • Listing unit funds units • Holding active marketing campaigns • Modifying trading system • Launching new version of KASE web-site

24. CONTACT US … Internet: www.kase.kz e-mail: kase@kase.kz phone: (+7 727) 237 53 00, 272 98 98, 237 53 11, 272 06 00 fax: (+7 727) 296 64 02, 272 09 25 address: 291/3a, Dostyk av., Almaty, Kazakhstan