JUNE 2013 - FEAS

FEDERATION OF EURO-ASIAN STOCK EXCHANGES ANNUAL REPORT JUNE 2013
AMMAN STOCK EXCHANGE
The ASE has continued in 2012 with its
efforts, aiming at developing the market,
and increasing its efficiency.
Nader Azar
Acting Chief Executive Officer
The Amman Stock Exchange (ASE)
managed to pass the year 2012 with a
stable performance in spite of the unstable
political situation in the surrounding countries,
especially in neighboring Syria. On the
economic level, 2012 wasn’t an easy year for
Jordan as well, due to multiple factors that
weighed on the budget deficit including the
huge influx of Syrians seeking refuge in Jordan,
the Egyptian gas supplies that stopped for a
prolonged period, and the foreign aids that
stalled. However, these economic issues eased
before the end of the year, and the performance
of the ASE was stable as it can be noticed
by the slight decline in the ASE general price
index which went down by 1.88%. In addition,
the ASE retained the confidence of investors
especially foreign investors whose ownership in
the ASE stood at 51.7% at the end of 2012.
On the other hand, the ASE continued with its
efforts in updating the technical infrastructure.
And on the legislative level, the ASE applied
new Listing Securities Directives. These
directives are considered a major achievement
in the year 2012, and according to these
directives, listed companies were distributed on
three different markets instead of two, with the
third market having different trading hours and
the first market having higher fluctuation limits.
The criteria that determine to which market
each company pertains include shareholders
equity, free float of the company, profitability,
company’s capital, number of shareholders,
and others. As for the performance of the ASE
during 2012, the Free Float Weighted Index
went down by 1.88% to close at 1958 points
compared with its 2011 closing of 1995 points.
The trading value reached US$ 2.8 billion and
the number of traded shares reached 2.4 billion
while the number of transactions reached 1
million. In addition, the net of non-Jordanian
investments at the ASE showed an increase of
US$ 53.1 million during the year 2012.
HISTORY AND DEVELOPMENT
The Amman Stock Exchange (ASE) was
established in March 1999 as a non-profit,
private institution with administrative and
financial autonomy. It is authorized to function
as an exchange for the trading of securities.
The Exchange is governed by a seven-member
board of directors. A Chief Executive Officer
oversees day-to-day responsibilities and
reports to the board. The ASE membership is
comprised of Jordan’s 63 brokerage firms.
The history of securities trading in Jordan
traces its origins back to the 1930s. In 1976,
the Amman Financial Market was established
to create a regulated trading market. More
recently, as part of Jordan’s move to upgrade its
capital market, a Securities Law was enacted in
1997 separating the supervisory and legislative
roles from those of exchange operations. As
a result, the Jordan Securities Commission
(JSC) was created in the year 1997, the ASE
and the Securities Depository Center (SDC)
were established in 1999. The JSC supervises
the issuance of and trading in securities and
monitors and regulates the market. The SDC
oversees clearing and settlement and maintains
ownership records.
To provide a transparent and efficient market,
the ASE implemented internationally recognized
directives regarding market divisions and
listing criteria. It also adopted procedures for
improving regulatory effectiveness.
The ASE is charged with:
• Providing companies with means of raising
capital by listing on the ASE,
• Encouraging an active market in listed
securities based on the effective
determination of prices and fair and
transparent trading,
• Providing modern and effective facilities and
equipment for trading, recording the trades
and dissemination of prices,
• Monitoring and regulating trading, in
coordination with the JSC as necessary, to
ensure compliance with the law, a fair market
and investor protection,
• Setting out and enforcing a professional
code of ethics among its member directors
and staff,
• Ensuring the provision of timely and accurate
information of issuers to the market and
disseminating market information to the
public.
On March 26th 2000, the ASE launched an
automated order-driven Electronic Trading
System. The system is in compliance with
international standards and takes into account
the G-30 recommendations. This system also
offers brokers immediate access to stock prices
and orders and enables members to trade
remotely.
In May 2006, the ASE has activated a new
version of the electronic trading system (NSC
V2+), which comes as part of the efforts to
meet the increasing needs of the Jordanian
capital market and in order to raise the capacity
of the current electronic trading system to
accommodate the increase in the daily trading
volume.
On March 22nd 2009, the ASE launched the
new version of the electronic trading system
NSC V900. This project is considered a
quantum leap for the concerned institutions
as the electronic trading system has become
linked with the SDC systems and the JSC new
monitoring systems. The new version will help
develop the trading process at the ASE and
enhance the capacity of the electronic trading
system.
On July 14th 2010, the ASE launched the
Internet Trading service. This service is seen as
a major opportunity for interested investors to
trade in securities regardless of their geographic
location. In addition, the service will help
increase the number of investors at the ASE and
enhance their aptitude to engage in securities
trading.
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