Capital Markets by CEO of MSE Kh.Altai

1. FOR BUSINESS COUNCIL OF MONGOLIA MEETING
JANUARY 25, 2018
Presenter: Mr. Altai Khangai,
CEO, Mongolian Stock Exchange
Mongolian Stock Exchange

2. 1,455
2,436
1,400
1,600
1,800
2,000
2,200
2,400
2,600
2,800
3,000
Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17
InbillionMNT
YEAR 2017: MARKET CAPITALISATION AND TOP-20 INDEX
CAGR: +67.4%
2017 KEY STATISTICS:
Market cap : 2,4 trillion MNT
Total trading volume:
Equities: 76,4 billion MNT
Government bond: 772,5
billion MNT
Corporate bond: 10,2 billion
MNT
NEW PRODUCTS:
Suu Bond – 6,0 billion MNT
Itools JSC IPO – 1,3 billion
MNT /oversubscribed by 3/
10000
12000
14000
16000
18000
20000
22000
24000
Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17
CAGR: +68.9%
TOP-20 index
Market capitalisation
Mongolian Stock Exchange

3. SECURITIES DUAL-LISTING
FINANCIAL REGULATORY COMMISSION
APPROVES THE DUAL-LISTING
REGULATION
Main features:
1. Approve the legal opinion, audit and
valuation reports written by overseas
practitioners
2. Provide waivers for ongoing disclosure
and compliance with domestic capital
markets regulations, allowing the dual-
listed company to comply with the rules
of the primary exchange.
Mongolian Stock Exchange

4. A global custodian bank signs a sub-custody agreement with one of the top local
banks, setting the foundation for bringing foreign professional investor capital to the
country.
Main requests raised by the bank are as follows:
1. T+2 settlement system
2. “Delivery vs Payment” /DvP/ principle
3. Risk management framework for settlement risks /such as establishment of the
Settlement Guarantee Fund/
4. Company dividends to be paid to the custodian’s account at the CSD. /i.e. stop the
dividend distribution at company venue/
5. Increase government bond trading
GLOBAL CUSTODY SERVICES INTRODUCED
Mongolian Stock Exchange

5. - Broadcasted all over
the country through
Mongolian National
Radio and Television
/MNB/ channel, for 2
months.
- 8 episodes from Dec
11 – Jan 22
- 5 participants from the
public
- Increased public
awareness and
interest in the capital
market observed since
the start of the show
CAPITAL MARKETS REALITY SHOW – ‘GREEN ARROW’
The first ever reality show on capital markets
Mongolian Stock Exchange

6. Long term goal /5-10 years/:
Create an orderly, transparent and efficient capital markets that align with international practices
Medium term goal /3-5 years/:
Official recognition as a FTSE Frontier market
Short term goal /1-2 years/:
Inclusion in the FTSE Frontier market watchlist
 Settlement system reform /Т+2 system, DvP mechanism etc/
 Revision of rules and regulations /Index rules, Trading rules, Listing rules/
 List the first foreign-listed company
 Study the feasibility of the first ETF product and promote it to relevant parties if feasible
 Promote the market to the issuers, investors and to the public.
MSE PLAN 2018
Mongolian Stock Exchange

7. THANK YOU FOR YOUR ATTENTION
Mongolian Stock Exchange