International SeminarInternational Seminar Punta del Este – Uruguay Punta del Este – Uruguay

October 26 – 28, 2005 October 26 – 28, 2005

Experience and performance of different Experience and performance of different structures among organizations that trade, structures among organizations that trade,

deposit and settle securitiesdeposit and settle securities

Luis María CorsigliaCaja de Valores - Argentina

CAJA DE VALORESCAJA DE VALORES

Central DepositoryCentral DepositoryOf SecuritiesOf Securities

Structure Structure of the Argentine Securities Marketof the Argentine Securities Market

Stock Exchange

SecuritiesMarket

Ministry of FinanceComisión Nacional de Valores

Regulator

•Deposit

•Custody

•Registry

•Systems

•Auhorization to quote

•Prices

•Release of information

•Stock brokers and Brokerage houses

•Trading

•Settlement

InstitutionalMarket

Banco de Valores

Banco Centralde la

Rep. ArgentinaCRYL

Futures and options Markets

MATBA-ROFEX

OTC

MAE

LocalExchanges and

Markets

Securities Market ResponsibilitiesSecurities Market Responsibilities

Financing source of companies and government

Savings Guide in productive activities

Generator of liquid investments

Fuel for economic development of the country

Buenos Aires Stock Exchange Mercado Abierto Electrónico (OTC) Mercado de Valores de Buenos Aires Caja de Valores S.A. MATBA – ROFEX Provincial Exchanges and Markets Regulator:

Comisión Nacional de Valores

Institutions of the Capital MarketInstitutions of the Capital Market

BCBABCBA

MAEMAE

MATBAMATBA

ROFEXROFEX

MERVALMERVAL

Provincial Provincial MarketsMarkets

C N VC N V

CVSACVSA

Buenos Aires Stock ExchangeBuenos Aires Stock Exchange Non-profit civil association, created in 1854, with 5,800 associates;

its Board Council gathers representatives of the different sectors

of the economy

Responsibilities

Enacts regulations for the quotation and authorizes, suspends and interrupts

quotations in accordance with such regulations, as it supervises their fulfillment

Enacts rules and measures to ensure veracity of balance sheets and other

documents of listed companies, to whom it also inspects

Keeps registry of trades and prices, ensures accuracy of such registries and daily

publishes everything related thereof

Publishes financial states of listed companies and releases material information

Mercado de Valores de Buenos Mercado de Valores de Buenos Aires Aires

Self-regulated corporation, with 183 shares of networth that

empower holders to act as brokers or brokerage houses.

Currently there are 127 operating companies. Last price of

Merval share

$ 2,150,000 (March, 2005).

Responsibilities

Execution, settlement, surveillance and guarantee of trades

Empowered to supervise and take disciplinary measures on brokers

and brokerage houses

Regulates, coordinates and carries out all aspects related to trading

of securities, types of securities and trading, payment conditions, etc.

CAJA DE VALORES S.A.CAJA DE VALORES S.A.

Central Securities Central Securities Depository Depository

A corporation whose shareholders are BCBA,

MERVAL and local Exchanges and Markets, created

in 1974.

Collective DepositCollective Deposit

DepositorDepositor

Subaccount

Subaccount

Subaccount

Subaccount

Depositor

Subaccount

Subaccount

DEPOSITORS CAN BE:

•Stock Brokers and OTC brokers

•Stock Markets

•Banks and Financial companies

•Depository companies of FCI

•Global Custodians

HOLDERS OF SUB-ACCOUNTS ARE:

•Investors (individuals or companies)

Remote opening of Sub-accounts “Holders” through the System from the Depositors’ offices

Servicies of Issue of Holding and Meetings Certificates Information to Depositors: daily listing, on-line customer

service

Delivery of quarterly statements by mail Report of balances of holders accounts and movements during the last quarter

Statements Feedback 1st. Mark to the sub-account 2nd. Blocking of sub-account

Other blocking Legal order: embargo of some/every security

(Securities in Guarantee) Economic rights on securities: pledge Special blocking

Mark

Aspects of holders accountsAspects of holders accounts

BlockingSub-account

Depositors AccountsDepositors AccountsTotal 604

Sub-accounts opened October ´05 2.879.661 Balanced 708.529 Unbalance 2.171.132

Delivery of quarterly statements by mail Report with holders accounts balances and operations

carried out during the last quarter

Cuentas ComitentesCuentas Comitentes55%

3%

27%9%

6%

Brokers

Financial Cos.

Banks (162)

Mutual Funds (57)

Others (37)

CustodyCustody

Public Securities Caja de Valores 32,607 Euroclear 8,617 Clearstream 4,495 DTC 1,886 CRYL 111,167

SUBTOTAL 158,773TOTAL CUSTODY V$N 174,378TOTAL CUSTODY V$N 174,378

(in millions)

Securities Securities under under

Custody as of Custody as of October ´05October ´05

The first physical security was sent by Canale S.A. in 1977 and the first escritural security was received in 1988 by Banco de Suquía.

An important process of physical securities conversion into book-entry securities took place. Currently less than 2% of securities under custody are physical.

Technology Developments: Filing of orders/Electronic Matching/

Dissemination/Settlement/Clearing/Custody

Lines of BusinessLines of Business

Issuers Services Depositors and investorsservices

Joint Deposit+

Asset servicing

Numbering Agent

Payment Agent

Registrar

Exchange Agent

Closing of trades

Trust Agent

Underwritting Agent

Caja de Valores as Trust AgentCaja de Valores as Trust Agent Related to assets in trust:

To keep them segregated from their own and mantein them Honour tax burdens thereof After agreement maturity, transfer them in accordance to agreement’s

provisions

Management of assets in trust, for third parties benefits (beneficiaries)

Some trusts in which Caja de Valores acts as trustee: Guarantee trust of Secured Loans. CCF trust, authorized for tax cancellation. Trust for Scotiabank selling transaction.

TradingTrading

Types of TradingTypes of Trading

Floor: Outcry trading Outcry trading

The offer includes security, amount and price

Electronic trading

SINAC – computarized electronic trading system -

Participants send offers and these are matched on the system, are filed

and reflected for all the traders

Concurrence: combines both mechanisms for pricing

Continuous Trading: for cash and term wholesale trades

Outcry TradingOutcry Trading

Buy-sell Offer

Security - Price – Amount

(outcry)

Acceptance of Offer

(outcry)

Ticket issue For Buyers, Seller and Exchange Kiosk

Physical area for execution:

STOCK EXCHANGE TRADING FLOOR

Electronic TradingElectronic Trading

SINACComputarized Trading

System

Data disseminationPrice – Volume - Offers

Transfer of ordersConfirmation &

Identification of Trades

Transfer of ordersConfirmation &Identification of Trades

Trader A Trader B

2005 Traded Volumes2005 Traded Volumes

Source BCBA

Stocks

Bonds

Others

Peso

s m

il lio

ns

Information Information TechnologyTechnology

Exchange IT

The automated trading system (SINAC) follows specifications of the

European exchanges federation.

The settlement system has been designed under G30 recommendations

and IOSCO reports, honours every requirement of CNV and specialized

international entities.

The guarantee management system allows for the integral

management of guarantees required by futures trading: forwards, options,

loans, short sells, repos.

The custody system handles holders sub-accounts and the operating

system of electronic transfers of securities follows IT safety rules required

by international organizations.

International standards on everyphase of the exchange operating

system

Exchange IT

Systems integration: Main factor for risk management

Securities Trading

Trading Registration

On-line dissemination

Markets Supervision

Guarantees management

Trades settlement

Securities Custody

Negotiable Securities

The Exchange System manages

securities quotes in different

monedas (dollars, marcs, etc.).

The trading currencies are

pesos or dollars.

Securities:

Shares

Public Bonds

Negotiable Obligations

ADRs(American Depositary Receipts

CEDEARs

Forwards

Over 5.000 securities

Cash Trades

Systems are designed for the settlement of trades during the day. Currently trades are settled on T+3.

Term trades Forward Repos – Loan Options Indexes term Securities in Loan

IT NetworksIT Networks

Point-to-point private links with all brokers and brokerage houses of the market.

Point-to-point private links with regulators, investors, depositors, news agencies and financial institutions.

Inter-connection of local networks of exchange entities through an optic fiber structure.

Access to Internet of high capacity with double point connection in order to ensure continuous servicing in case of failures.

Internet high-speed communication for every Broker (this is used for access IT services in case of point-to-point link interruption).

Wireless networks at BASE floor, through which brokers may access on-line information, receive orders from their offices or from investors, close automated trades, access e-mail services, chat and Internet.

The country’s largest private virtual network

Data ProcessingData Processing

Technology Platforms of last generation.

Two data processing centers:

Main CenterMain Center, with high-capacity processing and high-availability configuration. It is used exclusively to render IT services.

Alternate CenterAlternate Center, regularly used to carry out maintenance tasks and systems development. Ensures continuous servicing, re-starting processes at the main center in case of contingencies.

Data base replicated at both computer centers, simultaneously updated on-line.

180.000 trades/day2,800 users

New marketsNew markets

Electronic Gas Market (MEG): determines the new trading of SPOT gas (gas for that day).

Executive Power Decree 180/05 MEGSA (corporation created by the Buenos Aires

Stock Exchange).

Trading mechanisms: PIST: trading of gas at well point Citygate: trading of gas plus transportation at delivery point

First stage (achieved): PIST mechanism Includes trading, dissemination, transportation authorization,

filing and settlement

Automated SignatureAutomated Signature

CVSA is the digital certification agent for users of the exchange IT systems.

Systems developed by CVSA allow for the authentification of users and for electronic signature of large-volume trades.

Technology used is based in RSA algorithms with asymetric keys of large size.

Data exchanged between central systems and workstations are enclypted by applying keys that are dynamically modified.

Consequently, users may consult holdings under custody and execute securities transfers from their offices within a safe framework.

IT Safety

Our achievements and Our achievements and perspectivesperspectives

Some of our 2004-05 Some of our 2004-05 achievementsachievements

CAJA DE VALORES SA: main clearing agent in the most significant Exchange of Public Debt in history

As regards volume of issue, diversity of securities, amount of currencies and different legislations of issues for the so-called Eligible Debt

Underwritting of an agreement with ANSSES targetted to the filing of holders of PRE8 bonds

Opening of reciprocal accounts between CVSA and CBLC (Brazil) Start-up of negotiations with DCV (Chile) and INDEVAL (Mexico) within the

framework of Federación Iberoamericana de Bolsas de Valores (FIAB) recommendations

Final approval of SEPYME for Garantía de Valores SGR operation The activities are targetted to the granting of guarantees for small and

medium-sized companies financing Certification based on ISO 9001-2000 standard, granted by Det

Norske Veritas In the processes of Customer Services at Headquarters and Users Services

Center.

Garantía de Valores SGRGarantía de Valores SGR

In 2003, Caja de Valores promoted the creation of a reciprocal guarantee corporation

Currently it is comprised by over 190 partners representing brokers and brokerage houses of the country and small and medium-sized companies of a diversity of productive sectors

Risk fund of $30 millions Its main target is to grant guarantees to undertakings of its partners

with the purpose of fuelling the development of small and medium-sized companies and promoting new business lines within the capital market structure

To guarantee trades of Diferred Payment Checks Discount on BASE, bank intermediation, negotiable obligations and financial trusts, among others.

International ScopeInternational Scope ANNA

Attendance to Meetings Extraordinary Meeting, Tunisia – Dec. 2004, delegating

powers on Chile and Panama. Ordinary Meeting, Zurich – June 2005, delegating powers on

Chile, Costa Rica, Panama and Venezuela.

Member of ANNA Service Bureau Advisory Board (ASB AB)

The ASB AB is the committee in charge of ASB management, technical body of ANNA that consolidates all ISINs of every National Numbering Agency (ANN) of the world, making them available to the market.

We were appointed members of AB, for a 3-year term, at the Ordinary Meeting held in Zurich, June 2005.

We took part of ASB AB meeting held in Brussels on July 2005.

International ScopeInternational Scope ANNA (cont.)

Leader of ANNA Latinoamericana (ANNA L.A.) project

The project consists in the creation of a task group of the region’s ANNs, coordinated by a regional management, aimed at promoting the best practices on services for securities exchange codes allotment, under ANNA regulations.

We invited Brazil, Chile*, Costa Rica*, Mexico*, Panama*, Peru and Venezuela* to be part of this undertaking

(*) Already formally informed ANNA Board of their cooperation with the project.(Note: El Salvador, that recently gave its consent to be a “partner” of ANNA, shall be contacted soon).

International ScopeInternational Scope

Letters of Intent with:

CAVALI - Peru

DECEVAL – Chile

Start-up of negotiations with:

INDEVAL - Mexico

Operating:

CVSA-CBLC Reciprocal accounts

(fully operating)

Accounts opened at:DTCC – As direct participant

Iberclear - Euroclear – Clearstream

Securities Transfers Securities Transfers

Dividends Payment in pesos, dollars and eurosDividends Payment in pesos, dollars and euros

Political and economic rights Political and economic rights

Of investors’ securities deposited in foreign marketsOf investors’ securities deposited in foreign markets

(Meetings and votes by shares and negotiable obligations)(Meetings and votes by shares and negotiable obligations)

Luis M. Corsiglia

corsiglia@cajval.sba.com.ar

www.cajval.sba.com.ar