- The author argues that fears about Spain are excessive given its economic fundamentals relative to other troubled European economies. - While Spain has a large public deficit and debt, its debt levels are lower than countries like France and Italy. Its economy is also more diversified which gives it advantages over Portugal and Ireland. - Spanish bond markets have been more resilient than those of Portugal, suggesting equity markets may be overreacting to sovereign risk concerns regarding Spain. - The author believes consensus forecasts underestimate the potential for growth in Latin America, where large Spanish banks have significant exposure, and overestimate the impact of Europe's debt problems on Spanish banks. - Given Spain's low valuation relative to its European peers and signs that

1. 4 May 2010
Equity Strategy
Weekly
www.sgresearch.com
Equity Prism
Spain is not Greece: we are now tactically bullish
0 Top-down Spain is not the next to drop
-2
We were surprised by the S&P rating downgrade on Spain
DE
Public deficit (% of GDP)
-4 AU
NL
last week. While we share the point of view that the country
EMU IT
-6 BG needs to reduce its deficit, public debt is lower than its euro
FR
-8 area neighbours. We strongly believe that Spain is not the
PT next domino in Southern Europe to fall, as its cyclical
-10
-12
ES outlook is improving. While unemployment is high and the
IR GR
country needs fiscal tightening, productivity is improving on
-14
0 20 40 60 80 100 120 140 the back of large job cuts, and competitiveness could
Public debt (% of GDP)
surprise those who remain sceptical.
Strong correlation between equity and spreads Country allocation Buy the IBEX as fears
appear excessive
12500 2.5
11500 3.0
Year-to-date the Spanish (-12.0%) stock market has been
10500 3.5
one of the worst performers along with the Greek (-16.2%)
9500 4.0
and Portuguese (-12.1%) indices. With a low valuation (20%
8500 4.5 discount to the Europe index on 2010e P/E and 29.8% on
7500 5.0 trailing data) and already weak earnings growth discounted
for the coming years (for 2010e +1.5% vs 32.1% for
6500 5.5
Aug-08 Nov-08 Feb-09 May-09 Aug-09 Nov-09 Feb-10 Europe), we believe short-term potential for disappointment
IBEX (lhs) Spain 5yr CDS (log inverted) is now limited. We therefore suggest a tactical buy on the
IBEX.
60 Sector allocation Spanish banks heavily
50 exposed to fast-growing Latin America
40 18m forward EPS growth (%) Greek, Italian, Portuguese and Spanish banks are
30 vulnerable, but Greek banks are probably most at risk. While
large Spanish banks are well capitalised and exposed to the
20
fast-growing Latin American region, Italian banks have high
10
exposure to the Continent. Overall, we believe that profit
0
growth expectations for Spanish companies overestimate
00 00 01 01 02 02 03 03 04 04 05 05 06 06 07 07 08 08 09 09 10
-10 the impact of the bleak debt environment but underestimate
Spanish Banks European Banks
potential growth from Latin America.
Source: SG Cross Asset Research, Datastream
Equity Strategy Equity Strategy Equity Technical Analysis Specialist sales
Claudia Panseri Charlotte Lize Loic de Galzain Paul Jackson
(33) 1 58 98 53 35 (33) 1 42 13 83 98 (33) 1 42 13 47 12 (44) 20 7762 5921
claudia.panseri@sgcib.com charlotte.lize@sgcib.com loic.de galzain@sgcib.com paul.jackson@sgcib.com
Please see important disclaimer and disclosures at the end of the document
Macro Commodities Forex Rates Equity Credit Derivatives

2. Equity Prism
Contents
3 Asset allocation by sector
0
4 Investment summary
1H
5 Spain is not Greece: we are now tactically bullish
2H
5 Why Spain has been underperforming Italy and Ireland…
3H
5 …while Spanish bonds have been more resilient?
4H
7 Spain’s economic situation not as bad as feared
5H
9 PIIGS market structure penalises market performance
6H
10 Consensus forecasts already discount the worst…
7H
11 …but fail to reflect potential benefits of Latin American exposure
8H
12 Spain’s valuation discounts a very bleak environment
9H
Tables index Charts index
3 European recommended sector allocation
10H 4 Valuation closes at the 20y bottom
16H
9 Sector breakdown for PIIGS countries
1H 5 Why should Spain underperform Italy and Ireland?
17H
10 IMF gross domestic product expectations (%, constant prices)
12H 6 Spanish CDS spreads have been unaffected
18H
10 IBES EPS growth expectations (%)
13H 6 10y bond yield spread to German yield
19H
11 Spanish companies with sales exposure to Latin America of above 10%
14H 7 Greek consumers likely to be hard hit by fiscal tightening
20H
12 IBES P/E forecasts (x)
15H 7 Greece has the highest public debt, but Ireland and Spain show the
21H
steepest deterioration
8 Harmonised competitiveness indicators (ULC-deflated)
2H
8 France’s public debt is higher than Spain’s!
23H
9 IBEX 35 – lack of pharma, tech and consumer goods
24H
9 Banks are penalised by contagion fears
25H
10 While EPS growth is largely below the European average…
26H
10 …sales growth is slightly above
27H
11 Long-term earnings growth (%) – Spain more resilient to the downside
28H
12 P/E multiples discount Spain’s bleak environment
29H
12 Now valuation is close to the bottom seen back in 1992
30H
2 4 May 2010

3. Equity Prism
Asset allocation by sector
European recommended sector allocation
MSCI Last Changes New SG Premium List
% recommendation today recommendation
Oil & Gas 10.9 OVERWEIGHT
Integrated Oil Companies 10.1 Overweight Royal Dutch Shell
Oil Services 0.8 Neutral
Basic Industries 9.7 OVERWEIGHT
Chemicals 3.0 Overweight BASF
Construction Materials 0.9 Overweight
Containers & Packaging 0.0 Neutral
Steel, Metals & Mining 5.4 Neutral ArcelorMittal
Paper, Packaging 0.3 Overweight
Industrials 10.0 OVERWEIGHT
Aerospace & Defence 0.9 Neutral
Construction 1.5 Overweight Saint Gobain
Capital Goods 5.4 Overweight Vallourec, Volvo
Transportation & Other services 2.1 Overweight Fraport
Consumer Discretionary 7.4 OVERWEIGHT
Automobiles & Components 1.8 Overweight Daimler
Durables, Apparel & Luxury 1.5 Neutral
Hotels, Restaurants & Leisure 0.8 Overweight Accor, Compass Group
Media 1.9 Overweight Reed Elevier Plc
Retailing (general) 1.2 Neutral Kingfisher
Consumer Staples 12.0 NEUTRAL
Food & Staples Retailing 2.1 Overweight
Beverages 2.3 Neutral
Food 4.8 Underweight
Tobacco 1.5 Underweight
Household & Personal Care 1.1 Neutral
Healthcare (includes Pharma) 10.1 UNDERWEIGHT Fresenius Medical Care
Financials 23.7 NEUTRAL
Commercials Banks 13.3 Neutral
Investment Banks 4.2 Neutral Barclays
Insurance 5.1 Overweight ING, Swiss Life
Real Estate 0.9 Neutral
Information Technology 2.9 OVERWEIGHT
Software & IT Services 1.0 Overweight SAP
Technology Hardware & Eqpt. 1.5 Neutral
Semi-conductors 0.4 Overweight
Telecommunication Services 6.7 UNDERWEIGHT
Diversified Telecom 4.7 Underweight
Wireless Telecom 1.9 Underweight
Utilities 6.0 NEUTRAL
Source: SG Cross Asset Research
4 May 2010 3

4. Equity Prism
Investment summary
Spanish fixed income more resilient than equities The widening gap between euro area and
US growth coupled with concerns about a potential eurozone break-up should continue to exert
pressure on the euro area. That said, notwithstanding rising pessimism on the eurozone, we
strongly believe that some countries in the region remain attractively valued (we are already
Overweight on Germany). While the risk of fiscal tightening looks extremely high in Portugal, Italy,
Ireland, Greece and Spain (PIIGS), we believe that after its recent underperformance, the Spanish
index is attractively valued and is set to outperform other PIIGS in the short term. The relative
resiliency of the Spanish bond market (both corporate and government bonds) also points to a
probable over-reaction from equities investors compared with fixed income investors.
Spain’s economic situation not as bad as feared Spain is in a difficult public deficit
position (-11% versus the GDP), which is deteriorating quickly. While we do not want to
minimise the situation as unemployment is very high (19.4%) and restructuring will take time,
Spain has already undergone 18 months of painful economic adjustment. The near-term
outlook for the economy is admittedly bleak. Economic activity will likely stagnate this year, as
fiscal policy tightens. But beyond 2010, the country should at least match the eurozone’s
average growth rate (IMF 2012 GDP forecasts: 1.5% vs 1.8% for the euro area). Initial signs
are encouraging as labour market adjustments have helped to boost labour productivity and
cut unit labour costs, restoring some of the competitiveness that had been lost. More needs to
be done, but this is a positive development . 0F0F
1
Spanish profit growth discounts sovereign risk but not Latin American demand According
to IBES forecasts, Spanish 2010-2012e profits growth is the lowest within the euro area and
stands even below that expected in Greece. We strongly believe that consensus forecasts are
overestimating the impact of debt on the Spanish financial system (financial stocks represent
32.8% of the IBEX’s market cap) and underestimating potential growth from Latin America.
While Italian, Portuguese and Spanish banks are vulnerable, Greek banks are probably most at
risk. And while large Spanish banks are well capitalised and exposed to the fast-growing Latin
American region, Italian banks have high exposure to the Continent, with loan coverage well
below the mean.
We are tactically bullish on Spain While Latin America is growing faster than the rest of
the world, Spain’s multiples are trading at a discount to the European average.
Spain’s debt situation is worrying indeed; but Valuation closes at the 20y bottom
we also believe that Spanish companies’ high 50%
40% Historical Spanish P/E discount to
cash flow profiles and savings rates should 30%
European average
help large caps in the event of a severe fiscal 20%
10%
tightening policy. Therefore, with the Spanish 0%
-10%
market trading at a 29.8% discount to the
-20%
-43% -29.8%
European average (the bottom was 43% in -30%
-40%
1992), we are tactically buyers of the IBEX. -50%
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Source: SG Cross Asset Research
1
For more details please refer to page 69 of SG Global Economic Outlook dated 13 April 2010 “Reshuffling balances”
and to the SG Economics report dated 22 April 2010 “No time for a Greek holiday”
4 4 May 2010

5. Equity Prism
Spain is not Greece: we are now tactically bullish
Since the beginning of the year, alpha generation has mainly come from country
allocation more than sector allocation. In our latest calls “Want to hedge euro sovereign
31H
risk? Buy the DAX, stay Neutral on Banks” (13 April) and “Buy UK stocks on devaluation
32H
fears” (20 April), we suggested taking advantage of rising fears about European
sovereign risk by building strategic positions (long-term) on the weakness of the euro or
the sterling versus the dollar.
Today’s call is a tactical one and the rationale behind it is based on our premise that last
week’s market reaction on Spain is excessive. Sovereign risk remains the main concern
for equity markets, especially after S&P slashed Greece’s credit rating by 3 notches to
BB+ with a negative outlook, Portugal’s long-term debt by 2 notches to A- and Spain’s
to AA with a negative outlook. However, we believe that this environment offers some
good buying opportunities, and Spain offers one of the best in our view.
Why Spain has been underperforming Italy and Ireland…
Why should Spanish equity markets underperform Italy and Ireland when both of the latter
have similar debt profiles and less resilient banking systems? Since the beginning of the year
the IBEX has strongly underperformed the DAX, which is perfectly rational considering the
difference in those countries’ debt, deficits and market structures. What seems odd is that
while sovereign risk is also worrying for Ireland and Italy, these two countries are performing
better than the Spanish stock market.
Why should Spain underperform Italy and Ireland?
115
ASE (Greece) IBEX (Spain)
110
MIB (Italy) PSI20 (Portugal)
105
ISEQ (Ireland)
100
95
90
85
80
75
Jan-10 Feb-10 Mar-10 Apr-10
Source: SG Cross Asset Research
…while Spanish bonds have been more resilient?
Spanish fixed income assets and corporate and government bonds have been more resilient
than Portugal’s and as resilient as Italy’s. As explained by our economists in their report “No 3H
time for a Greek holiday” published on April 22, while Ireland, Portugal and Spain face very different
situations relative to Greece, their level of deficits and debt put them under pressure. Any
threat of a potential default by Greece would immediately raise concerns over the
sustainability of fiscal deficits in Ireland, Portugal and Spain. Concerns over Italy are more
subdued. Despite a debt-to-GDP ratio of over 115%, Italy has maintained a fairly tight grip on
4 May 2010 5

6. Equity Prism
its finances throughout the crisis, and as a result, its deficit reached only 5.3% in 2009. The
underlying position of Italy’s public finances therefore looks under control. Only a modest
effort will be necessary to stop the debt ratio from increasing again. While Spain has seen the
steepest deterioration in the last year, it is protected by its history of managing sound fiscal
policies pre-crisis and also by its size relative to its two European neighbours. This gives
Spain a broader tax base and more diversified economy, which should make it easier to
increase tax revenues if the need arises.
Spanish CDS spreads have been unaffected
1400
1200
Portugal
1000
Greece
800
Spain
600 Italy
Ireland
400
200
0
Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10
Source: SG Cross Asset Research
Also, the spread between Spain and Germany’s 10-year bond yields has increased, but has
been more resilient than in the case of Portugal and Ireland and in line with the Italian spread.
10y bond yield spread to German yield
800
Spanish spread Greek spread Italian spread
700
Irish spread Portuguese spread
600
500
400
300
200
100
0
Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10
Source: SG Cross Asset Research
6 4 May 2010

7. Equity Prism
Spain’s economic situation not as bad as feared
We have already written more than once that the debt situation in the eurozone looks
increasingly worrisome and that the widening gap between euro area and US growth coupled
with concerns about a potential eurozone break-up should continue to exert pressure on the
euro. That said, notwithstanding rising pessimism on the eurozone, we strongly believe that
the region remains attractively valued – some countries more than others, and tactical calls
may help to generate profits. The Greek risk/reward profile looks less appealing as stringent
fiscal policy will be required to reduce the debt burden. Of course the risk of fiscal tightening
looks extremely high in Greece, Spain, Italy and Portugal, but high saving rates in Spain and
improving productivity may be a cushion for the country.
Greek consumers likely to be hard hit by fiscal tightening
30.0
Euro area
25.0
France
20.0 Italy
Germany
15.0
UK
10.0 Portugal
Spain
5.0
Greece
0.0 Ireland
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: SG Cross Asset Research
Spain is in a difficult position, and the situation is deteriorating quickly. While we do not want
to minimise the situation as unemployment is very high and restructuring will take time, Spain
has already undergone 18 months of painful economic adjustment. The current account deficit
in relation to GDP has more than halved to 4.6% from its peak in 2008, when in absolute
terms it was the second highest in the world after the US.
Greece has the highest public debt, but Ireland and Spain show the steepest deterioration
30% 140.0
2009 2010e 2011e 2009/2010 changes (%)
Public Debt (% of GDP) 120.0
25%
100.0
20%
80.0
15%
60.0
10%
40.0
5% 20.0
0% 0.0
Ireland Spain UK Portugal France Greece Eurozone Germany Italy
Source: SG Cross Asset Research
4 May 2010 7

8. Equity Prism
The near-term outlook for the economy is admittedly bleak. Economic activity will likely
stagnate this year, as fiscal policy tightens. And the economy is unlikely to regain its status as
the fastest growing of the big four EC members anytime soon, as the country grapples with its
structural problems. But beyond 2010, Spain’s growth should at least match the eurozone
average growth rate. Initial signs are encouraging as labour market adjustments have helped
to boost labour productivity and cut unit labour costs, consequently restoring some of the
competitiveness that had been lost. More needs to be done, but this is a positive development
that should be recognised. In addition, the current account deficit has effectively been cut in
half, from 10% of GDP at the peak. This was not just the result of weak imports, but also of an
above-average export recovery. The Spanish economy appears to be re-orientating itself
towards exports. Lastly, although not yet complete, the excessive share of construction in the
economy has shrunk.
Harmonised competitiveness indicators (ULC-deflated)
120
Spain
115
110
Italy
105
France
100
95
Germany
90
85
1995 1997 1999 2001 2003 2005 2007 2009
Source: ECB, SG Cross Asset Research
The budget shortfall is beginning to roll over, a reduction plan is in place and the public debt-
to-GDP ratio is 60%, barely more than half the Greek ratio. Most importantly, the inflation rate
has converged with the eurozone average, one of many indicators confirming the decade-long
adjustment to membership of the currency club is complete.
France’s public debt is higher than Spain’s!
0
-2
DE
-4 AU
Public deficit (% of GDP)
NL
EMU IT
-6 BG
FR
-8
PT
-10
ES
-12
IR GR
-14
0 20 40 60 80 100 120 140
Public debt (% of GDP)
Source: SG Cross Asset Research, SG Global Economic Research
8 4 May 2010

9. Equity Prism
PIIGS market structure penalises market performance
What has particularly penalised the IBEX relative to other PIIGS markets is its market
structure. For example, relative to the Irish Index (ISEQ), which accounts for 38.8% of
industrials benefiting from the weakness of the euro, the IBEX is mainly based on banks and
telecoms, which have been the main underperformers of this first part of the year. Relative to
the Italian Index, the IBEX has been underperforming because it has less exposure to the Oil &
Gas sector, usually resilient in a negative market.
Sector breakdown for PIIGS countries
PSI 20 MIB 40 ISEQ Athex 20 IBEX 35 DJ Stoxx 50
Basic Materials 4.2% 5% 2.0% 1.1% 10.8% 8.0%
Consumer Goods 0.0% 8.6% 18.2% 14.7% 0.5% 14.0%
Consumer Services 13.1% 3.2% 17.7% 10.8% 7.3% 2.6%
Financials 15.2% 33.5% 9.0% 47.1% 32.8% 28.9%
Health Care 0.0% 0.0% 8.4% 0.0% 0.4% 3.6%
Industrials 13.2% 6.7% 38.8% 5.7% 8.7% 7.9%
Oil & Gas 16.3% 21.6% 5.7% 6.9% 5.0% 9.8%
Technology 0.0% 1.7% 0.1% 0.0% 0.5% 4.4%
Telecommunications 12.7% 3.8% 0.1% 8.2% 16.1% 9.4%
Utilities 25.3% 16.1% 0.0% 5.5% 17.9% 11.4%
100.0% 100.0% 100.0% 100% 100% 100%
Source: SG Cross Asset Research, Datastream
As previously mentioned, both the Spanish and the Italian indices are mainly composed of
financials stocks. The difference between the two banking systems is that while large Spanish
banks have their difficulties, they are well capitalised and their assets are heavily tilted towards
the fast-growing Latin American region. In contrast, Italian banks have high exposure to the
Continent.
IBEX 35 – lack of pharma, tech and consumer goods Banks are penalised by contagion fears
40.0% 3000 100
30.0% 2800 120
IBEX 35 DJ Stoxx 50
2600 140
20.0%
160
2400
10.0%
180
2200
0.0%
200
Consumer Goods
Telecommunications
Consumer Services
Technology
Oil& Gas
Basic Materials
Industrials
Financials
Utilities
Health Care
2000
220
1800 Greece stock index (lhs)
European Financials credit spread (inverted rhs) 240
1600
Jul-09 Sep-09 Nov-09 Jan-10 Mar-10
Source: SG Cross Asset Research
4 May 2010 9

10. Equity Prism
Consensus forecasts already discount the worst…
The IBES figures highlight something which appears particularly odd: why are Greek
companies expected to grow more than Spanish companies over the next three years?
According to the IMF’s GDP growth forecasts, Greece should remain in recession for the next
two years, while Spain, after this year’s negative economic growth, should enjoy a recovery in
2011. Does this mean that analysts are underestimating the potential for a rebound?
IMF gross domestic product expectations (%, constant prices)
2008 2009 2010e 2011e
Greece 2.02 -1.96 -2.00 -1.05
Ireland -3.04 -7.10 -1.55 1.94
Italy -1.32 -5.04 0.84 1.16
Portugal 0.04 -2.68 0.29 0.65
Spain 0.86 -3.64 -0.41 0.90
Source: SG Cross Asset Research, International Monetary Fund, World Economic Outlook Database, April 2010
IBES EPS growth expectations (%)
2009 2010e 2011e 2012e
Spain -10.0 1.5 13.6 11.6
Italy -41.3 17.4 28.2 15.8
Ireland -152.1 na na 256.1
European average -23.1 32.1 22.1 12.8
Greece -41.8 6.1 27.6 19.4
Portugal 10.5 -5.0 17.7 14.0
Source: SG Cross Asset Research
Even though bottom-line forecasts are far below the European average, top-line forecasts are
slightly above the European market. The problem is that Spanish operating leverage is low,
consistent with a structure based on Utilities and Telecoms, which have a high proportion of
fixed to flexible costs and therefore more capital intensity than the European average.
While EPS growth is largely below the European average… …sales growth is slightly above
35 12 12m forward Sales growth (%)
12m forward EPS growth (%)
30 10
25 8
Spain Europe
20 6
15 4
10 2
5 0
0 -2
Spain Europe
-5 -4
-10 -6
04 05 06 07 08 09 10 04 05 06 07 08 09 10
Source: SG Cross Asset Research
10 4 May 2010

11. Equity Prism
…but fail to reflect potential benefits of Latin American exposure
While we are negative on Spanish growth, we believe that upside could potentially be stronger
for Spanish companies than for Greek or Portuguese companies, as Spain’s profit growth is
driven by Latin American demand. As Latin America is expected to grow more than developed
countries (SG 2010e forecasts: real GDP 4.0% vs 2.2% for developed countries on average),
and Spanish large caps usually benefit from Latin American demand, we believe that profits
growth is underestimated at least for the next two years. The table below shows that a
significant portion of the IBEX index (Santander, BBVA and Telefonica account for 51% of the
index) is heavily exposed to Latin America in terms of sales. Even though demand from Latin
America is strengthening, profit forecasts do not take this stabilising factor into account, a
factor which played a major role during the recession and makes the country’s earnings
growth profile asymmetric relative to the rest of the Europe.
Spanish companies with sales exposure to Latin America of above 10%
Latin American exposure as a % of Local exposure as a % of 2008 sales
2008 sales
Repsol 42% 48%
BBVA 41% 35% (including Portugal)
Banco Santander 41% 27%
Prosegur Cia de Seguridad 37% 49%
Endesa 37% 58% (including Portugal)
Sol Melia 33% 49%
Mapfre 33% 59%
Cie Automotive 32% 68% (Europe)
Amper 32% 68%
Abengoa 25% 35%
Gas Natural 24% 63%
Sniace 20% 66%
Telefonica 20% 36%
Inypsa Informes 17% 64%
OHL 15% 49%
Iberdrola 14% 46%
Promotora de Informationes 14% 86% (Europe)
Viscofan 13% 58% (Europe)
Aguas de Barcelona 13% 83%
Faes Farma 10% 90% (including Portugal)
Indra Sistemas 10% 66%
Source: SG Cross Asset Research
Long-term earnings growth (%) – Spain more resilient to the downside
60
50
40
30
20
10
0
-10
-20 Europe Spain
-30
-40
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Source: SG Cross Asset Research
4 May 2010 11

12. Equity Prism
Spain’s valuation discounts a very bleak environment
While Latin America is growing faster than the rest of the world, Spain’s multiples are trading
at a discount to the European average. While the Spanish debt situation is worrying, we also
believe that Spanish companies’ high cash flow profiles and saving rates should help large
caps in the case of a severe fiscal tightening policy.
IBES P/E forecasts (x)
2009 2010e 2011e 2012e
Spain 11.0 10.8 9.5 8.5
Italy 15.0 12.8 10.0 8.6
Ireland na na 37.2 10.4
European average 17.0 13.0 10.6 9.4
Greece 10.2 9.6 7.6 6.3
Portugal 12.7 13.4 11.4 10.0
Source: SG Cross Asset Research
Therefore, considering that the Spanish market is trading at a 29.8% discount to the European
average (the bottom was 43% in 1992), we are tactically buyers of the IBEX.
P/E multiples discount Spain’s bleak environment Now valuation is close to the bottom seen back in 1992
30 50%
Europe Spain
40% Historical Spanish P/E discount to
European average
25 30%
20%
20 10%
0%
15 -10%
-20%
10 -30% -43% -29.8%
-40%
5 -50%
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Source: SG Cross Asset Research
12 4 May 2010

13. Equity Prism
IMPORTANT DISCLOSURES
Accor SG is acting as financial advisor in its demerger project.
Accor SG acted as financial advisor to Accor and Colony Capital on the valuation of Group Lucien Barriere.
ArcelorMittal SG acted as joint bookrunner for the equity and convertible bond offerings of ArcelorMittal.
ArcelorMittal SG acted as joint lead manager and joint bookrunner in the issue of unsecured bonds convertible into new shares and/or
exchangeable for existing shares of ArcelorMittal (OCEANE)
Barclays SG acted as Co-manager of Barclays plc's bond issue.
Barclays SG acted as co-manager in the Barclays senior bond issue.
Barclays SG acted as co-manger in Barclays' senior high grade bond issue.
Daimler SG acted as Joint bookrunner in the Daimler's senior bond issue (4.625% 02/09/14 EUR).
Kingfisher SG acted as agent in the tender offer for Kingfisher's 4.125% Notes due 2012.
Santander SG acted as joint bookrunner of Santander's covered bond issue (3.625% 06/04/17 EUR).
Santander SG acted as joint bookrunner in the Santander's covered bond issue (3.875% 27/05/14 EUR).
Vallourec SG advised the FSI in the increase of its stake in Vallourec
US THIRD PARTY FOREIGN AFFILIATE RESEARCH DISCLOSURES:
SG and its affiliates beneficially own 1% or more of any class of common equity of Accor, Daimler, Santander.
SG or its affiliates act as market maker or liquidity provider in the equities securities of Accor, Daimler, Royal Dutch Shell, Santander, Volvo.
SG or its affiliates expect to receive or intend to seek compensation for investment banking services in the next 3 months from Accor, ArcelorMittal,
Barclays, Compass Group, Daimler, Fraport, Santander, Vallourec, Volvo.
SG or its affiliates have received compensation for investment banking services in the past 12 months from Accor, ArcelorMittal, Barclays, Daimler,
Kingfisher, Santander.
SG or its affiliates managed or co-managed in the past 12 months a public offering of securities of ArcelorMittal, Barclays, Daimler, Santander.
IMPORTANT DISCLAIMER: The information herein is not intended to be an offer to buy or sell, or a solicitation of an offer to buy or sell, any securities and
including any expression of opinion, has been obtained from or is based upon sources believed to be reliable but is not guaranteed as to accuracy or
completeness although Société Générale (“SG”) believe it to be clear, fair and not misleading. SG, and their affiliated companies in the SG Group, may from time
to time deal in, profit from the trading of, hold or act as market-makers or act as advisers, brokers or bankers in relation to the securities, or derivatives thereof, of
persons, firms or entities mentioned in this document or be represented on the board of such persons, firms or entities. SG is acting as a principal trader in debt
securities that may be refered to in this report and may hold debt securities positions. Employees of SG, and their affiliated companies in the SG Group, or
individuals connected to then, other than the authors of this report, may from time to time have a position in or be holding any of the investments or related
investments mentioned in this document. Each author of this report is not permitted to trade in or hold any of the investments or related investments which are the
subject of this document. SG and their affiliated companies in the SG Group are under no obligation to disclose or take account of this document when advising
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