Tale of two citiesTale of two cities--------Comparison of Capital Markets Comparison of Capital Markets System In London and ShanghaiSystem In London and Shanghai

Joyce WangJoyce Wang

05-06-200905-06-2009

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International capital market systemInternational capital market system LondonLondon’’s capital market systems capital market system ShanghaiShanghai’’s capital market sysetms capital market sysetm Comparison of two citiesComparison of two cities’’ capital capital

marketmarket Develeping ShanghaiDeveleping Shanghai’’s multi-level s multi-level

capital marketcapital market

International capital market International capital market systemsystem

International capital market International capital market

Capital market refers to the securities Capital market refers to the securities financing and business for more than financing and business for more than one year loan term capital stock one year loan term capital stock markets, including stock market, bond markets, including stock market, bond market, fund market and long-term market, fund market and long-term credit market , etc.credit market , etc.

International capital market International capital market systemsystem

In todayIn today’’s mature capital market s mature capital market main system pattern---main system pattern---multi-levelmulti-level::

Mainboard Mainboard Second board(do pioneering work board)Second board(do pioneering work board)

Third board Third board Over-the-counter bulletin boardOver-the-counter bulletin board

LondonLondon’’s capital market s capital market systemsystem

LondonLondon’’s Capital Market s Capital Market systemsystem

Stock trading volume No. 3 in the worldStock trading volume No. 3 in the world IPO financing volume No. 2 in the world IPO financing volume No. 2 in the world Market cap. No. 5 in the worldMarket cap. No. 5 in the world 30% of global foreign exchange trading30% of global foreign exchange trading 70% of global bond trading70% of global bond trading 20% of global inter-bank trading20% of global inter-bank trading

LondonLondon’’s Exchangess Exchanges

mainboard----London Stock Exchange(LSE)mainboard----London Stock Exchange(LSE) second board----Alternative investment second board----Alternative investment

market(AIM)market(AIM) third board----Techmarkthird board----Techmark over-the-counter bulletin board----over-the-counter bulletin board----

Off exchange(OFEX)Off exchange(OFEX) Other exchanges----London Future And Options Other exchanges----London Future And Options

Exchange, London Carbon Trading Exchange, Exchange, London Carbon Trading Exchange, London Metal Exchange , Baltic Exchange ,etcLondon Metal Exchange , Baltic Exchange ,etc

Features of LondonFeatures of London’’s Capital s Capital MarketMarket

multi-level,Diversified,complete multi-level,Diversified,complete structurestructure

Satisfy companies financing needs at Satisfy companies financing needs at different levels and different times different levels and different times

Optimal allocation of various Optimal allocation of various resources resources

Regulation complicated Regulation complicated

ShanghaiShanghai’’s Capital Market s Capital Market systemsystem

ShanghaiShanghai’’s Capital Market s Capital Market

Stock trading volume No. 7 in the world Stock trading volume No. 7 in the world IPO financing volume No. 3 in the worldIPO financing volume No. 3 in the world Market cap. No. 6 in the worldMarket cap. No. 6 in the world Copper trading of Shanghai Futures Copper trading of Shanghai Futures

Exchange No. 2 in the world Exchange No. 2 in the world

ShanghaiShanghai’’s Exchangess Exchanges

mainboard----Shanghai Stock Exchangemainboard----Shanghai Stock Exchange Other exchanges----Other exchanges---- Shanghai United Assets And Equity ExchangeShanghai United Assets And Equity Exchange Shanghai Futures ExchangeShanghai Futures Exchange Shanghai Environment And Energy Exchange Shanghai Environment And Energy Exchange Shanghai Gold ExchangeShanghai Gold Exchange Shanghai Shipping ExchangeShanghai Shipping Exchange Shanghai Oil ExchangeShanghai Oil Exchange etc. etc.

Features of ShanghaiFeatures of Shanghai’’s Capital s Capital MarketMarket

Single level, leaning towards large Single level, leaning towards large companycompany

Government dominating, strict Government dominating, strict regulationregulation

Lots of medium and small businesses, Lots of medium and small businesses, especially science and technology, especially science and technology, cancan’’t get equity financing service t get equity financing service through the single level capital market. through the single level capital market.

Comparison of two citiesComparison of two cities’’ capital capital marketmarket

Comparison of two citiesComparison of two cities’’ capital capital marketmarket

mature vs. primitivemature vs. primitive Multi-level meet all kinds of demands vs. Multi-level meet all kinds of demands vs.

single level meet limited demandssingle level meet limited demands Highly innovative vs. relatively simple Highly innovative vs. relatively simple Too much virtue elements vs. too much Too much virtue elements vs. too much

base on real economybase on real economy

Developing ShanghaiDeveloping Shanghai’’s s

multi-level capital marketmulti-level capital market

Developing ShanghaiDeveloping Shanghai’’s multi-level s multi-level capital marketcapital market

A good news---Do poineering work A good news---Do poineering work board (known as board (known as ““second boardsecond board””) is ) is formally open in recent days , it is a formally open in recent days , it is a symbol of multi-level capital market symbol of multi-level capital market construction.construction.

Developing Assets Market ---a good Developing Assets Market ---a good supplement, served as third board.It is supplement, served as third board.It is completing the multi-level and completing the multi-level and diversifying system.diversifying system.

Shanghai assets market is a primaryShanghai assets market is a primary equity market equity market

Semi-standard

securitization

Developing ShanghaiDeveloping Shanghai’’s multi-level s multi-level capital marketcapital market

Non-standard

The endThe end

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us.

Thank youThank you