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FEDERATION OF EURO-ASIAN STOCK EXCHANGES ANNUAL REPORT JUNE 2010“TOSHKENT” REPUBLICAN STOCK EXCHANGEIn 2006 the TRSE plans to increase the volume of trade withsecurities. Most importantly, we will carry out technicalmodernization of the system of electronic exchange trades.Maximilian KhvanChairmanAs a result of all of the hard work of the staffof the “Toshkent” Republican Stock Exchange(TRSE) in 2005, the TRSE has achievedcertain positive results. In year 2005, 5814transactions with the shares of 643 joint-stockcompanies and 9 transactions with corporatebonds have been carried out on the tradingplatforms of the TRSE.• Trade with corporate bonds accounted for1%;• Shares of the privatized state enterprisesaccounted for 30.5%;• Shares of the privatized state enterprisesobtained by foreign investors for the hardcurrency accounted for 1.2%;• IPOs and other additional issued shares ofthe joint-stock companies for nationalcurrency as well as for the hard currencyaccounted for 4.1%;• Shares in the secondary market accountedfor 38.7%; and• Shares in the secondary market obtained byforeign investors for hard currency accountedfor 24.5% of the total volume.Although in comparison with thecorresponding period of 2004, the tradingvolume of shares has increased slightly, thetrading volume of shares for hard currencyhas increased 7.4%. Our efforts about theincrease of the secondary market have beenproving themselves. In the year 2005 tradevolume with shares in the secondary marketincreased 15%.We expect that the further development of thesecondary market will keep this pace.Currently, there are securities of 700companies in circulation in the secondarymarket, which should considerably increasethe share of securities in the secondarymarket.In 2006 the TRSE plans to increase thevolume of trade with securities. Mostimportantly, we will carry out technicalmodernization of the system of electronicexchange trades:1. Perfection of the technology of exchangetrades:First, the TRSE will create of a platform for thesecondary circulation of shares in thesecondary market, working on technologybased on simple auction. Second, the TRSEwill create a special platform on fulfillment oftransactions.2. Modernization by updating the equipment.The TRSE will complete modernization ofequipment in all branches and in theexchange itself.3. Modernization of trading system of the TRSE.The TRSE will translate into a newtechnological platform the whole tradingsystem of the Stock Exchange and create auniform database. Further the TRSE willendeavor to open facilities for regional brokeroffices to access the trading system fromdistance and implement maintenance of aclosed network of data transmission for allregional branches.HISTORY AND DEVELOPMENTA stock department was established in 1991,which became a pioneer of Uzbekistan’ssecurities market, and was eventuallytransformed in 1994 into the “Toshkent”Republican Stock Exchange (TRSE), a closedjoint-stock company. The TRSE became anopen joint-stock company in 1998.Establishment of the TRSE was closelyconnected to its market performance and apolicy of establishing public joint-stockcompanies on the basis of privatizedgovernment enterprises. Currently, the TRSEhas 39 shareholders.Throughout its development, the TRSEcompleted a complex infrastructure, a centraloffice in Tashkent, and branches and brokerageoffices in all regions nationwide. In 1994, 12brokerage offices were members of theExchange and as of the 1 July 2005, thisnumber had increased to 61.On 1 February 1998, a listing procedure wasintroduced. On 1 September 1998, shares ofthe first listed company began trading on theTRSE. A specialized trading platform, for thepurpose of selling shares of privatizedenterprises to foreign investors for hardcurrency, was launched on 1 January 1999.In 2001, work on Exchange information andelectronic trading systems continued. Thewebsite www.uzse.uz started operations in2001, and today the TRSE continues work on atransition to modern web-technology trading. Inaddition, the website reflects daily informationon IPOs and other JSCs. Investors may followall the current changes and information onlisted companies, share price and amountsstanding out.In 2003 new listing procedures were adopted atthe TRSE where the requirements for the officialas well as unofficial listing were stated.Currently the four largest companies ofUzbekistan are listed in Class “A” of the officiallisting.Founded 12 years ago as Uzbekistan’s firststock exchange, the TRSE is actively takingpart, always keeping in mind its major role, inthe development of the Uzbek capital market.FUTURE OUTLOOKThe priority directions of the development of theTRSE in 2006 will become the opening of anadditional trade sections on transactions forshares of unlisted companies.Additionally, the TRSE is planning to change thesoftware system and bring it to standards inaccordance with Rules of the Stock Exchange,as well as prepare new, more complexsoftware, in particular:• development of the module on conclusion ofturnip-deals, based on technology of continualdouble auction;• modernization of software system, based ontechnologies of the simple auction; and• full modernization of software system of theTRSE, with transition on new technical platform.PAGE 154