Letter of Transmittal

The Chairman

Malta Stock Exchange

27 Pietro Floriani Street

Floriana VLT 14

30 March 2000

The Hon J Dalli FCCA CPA MBIM MP

Minister of Finance

Valletta

Dear Minister

In accordance with Section 28 (1) of the Malta Stock Exchange Act (Cap. 345), I have the honour to transmit the Audited Financial Statements and Report on the activities of the Malta Stock Exchange for the Financial Year ended 31 December 1999.

Yours sincerely

Chairman

Chairman's Report

The past twelve months have indeed been a truly eventful period for the Malta Stock Exchange and for myself as Chairman. In the limited space available here, I can only comment briefly on the various events that took place in the past year and, whilst it is impossible to recapture the excitement, the tension, the strain and the stress of each particular moment, looking back I must admit that it was a year in which I myself as Chairman, together with the Exchange, achieved a considerable wealth of experience. Furthermore, 1999 was also the year when two very important projects, both of which were initiated more or less at the same time as the Exchange was born, reached their final phases.

In fact, one of the highlights of the past year was undoubtedly the long-awaited agreement with the Government whereby the Garrison Chapel in Castille Square, which until some time ago housed the Central Mailing Room, is to be converted into new premises for the Exchange. I say long-awaited because this building had been earmarked to be the permanent home of the Exchange way back in 1992 and so today we are very pleased to be able to say that construction work has started in earnest and is on target. In fact, we hope to be able to relocate to the new premises by mid-2001.

Another notable development was the attainment of full membership status within the prestigious International Federation of Stock Exchanges (FIBV). The first contacts with the Federation had been made as early as 1988 and, since then, the status of the Exchange within this Organisation grew steadily as its systems and operations continued to develop, from Corresponding Member in 1992 to Affiliate Member in 1996 and, finally this year, to full membership. I consider this an extremely important achievement for the Exchange because it denotes a certificate of compliance with international standards which is so vital if we are to give an on-going contribution to the development of Malta as an international financial centre. Moereover, I am pleased to report that the Malta Stock Exchange has also been formally invited to sit on the select Working Committee of the Federation. This is a privilege and an opportunity for Exchange officials to work at close quarters with people who are world authorities on the workings of capital markets and, I am sure, the knowledge and experience gained in such meetings will help the Exchange to maintain the high standards achieved up to now.

Undoubtedly, one of the most important events on the domestic financial scene during the past year was the sale of Government’s shareholding in Mid-Med Bank plc to HSBC Ltd. Maybe inevitably in our local business climate, what was essentially a straight business transaction became a highly controversial issue, generating inordinate pressures on the Exchange from various quarters. Although many a critical finger was then pointed at the decisions taken by the Exchange, I have no hesitation to confirm that during the weeks and indeed, months, that the affair dragged on, the Council invariably acted in the best interests of all the parties concerned, supported, as it were, by the continued understanding of the FIBV. I am pleased to point out that subsequent developments have vindicated the Council’s stand throughout.

During the past year, the Exchange has also introduced a set of new listing rules to support second board listings under the acronym ACL (Alternative Companies List). Some people would argue that taking this step at such an early stage in the history of the Exchange could be a risky move because local investors have not yet shed the traditional "savings" mentality and are, therefore, not sophisticated enough to take "investment" decisions. But it is the belief of the Council that taking up the challenge and facing the risk is the only way forward. A number of companies have already shown strong interest in the ACL and we hope to have the first listing under these rules by mid-2000. In order to further support this initiative, the Exchange has also taken the unpre- cedented step of doing away with the initial fees on new equity listings in order to encourage an increase in the number of listed companies and to give more depth to the market. We are confident that we will see the number of listed securities increase considerably during the coming months. This belief continued to gather strength with the publication of Government’s privatisation plans for the year 2000. The privatisation exercise should, in fact, also prove to be another important factor contributing to the growth of the Exchange, providing it with an opportunity to play a wider role on the local capital market and, in consequence, to support Malta’s efforts at becoming an international financial services centre.

The experiences of the past year have also highlighted certain deficiencies in the Law and in the rules and regulations of the Stock Exchange. Whilst these rules may have been adequate during the initial years of the Exchange, it is becoming increasingly obvious that they now need to be updated and strengthened in order to meet the new challenges of a dynamic Exchange. Indeed, apart from the formulation of new Bye-laws regarding buy-out procedures, take-overs and mergers and delisting, the Council has also commissioned a review of other areas in the Bye-laws with the aim of further strengthening the regulatory powers of the Exchange.

In conclusion I must thank my fellow members of the Council and all the Exchange staff without whose complete dedication and experience the Exchange would have faltered seriously. I must also thank the stockbroking profession for their solid support, and the authorities for their understanding in very difficult periods. Last but not least, I must thank the Federation of International Stock Exchanges and particularly the Secretary General, Mr Gerrit de Marez Oyens as well as the London and Mexico Stock Exchanges, whose role in the acceptance of our full membership of FIBV has indeed been fundamental.

Administration Report

The Council was appointed by the Minister of Finance in terms of Section 4 of the Malta Stock Exchange Act, 1990 (Cap. 345) and Section 5 of the First Schedule annexed to the Act for a period of two years with effect from 1 February 1999. Mr Renè G Saliba, the Central Bank representative on the Council was also re-appointed for a further year at the end of his tenure in October 1999.

Mr Alfred Mallia and Mr George Wells were appointed as Chairman and Deputy Chairman, respectively in terms of Section 5(v) of the First Schedule of the Malta Stock Exchange Act, 1990 (Cap. 345), while Mr Edward Cachia Caruana and Dr Arthur Galea Salomone were appointed to serve as Council Members.

The Council was very active during the first year of its tenure, meeting over 30 times during 1999. Such frequent meetings were necessitated by current activity within the capital market, such as Government’s sale of Mid-Med Bank plc shares, technology upgrades and major changes to the Exchange’s Bye-laws. These rapid developments within the Exchange were also reflected in the frequent meetings of the Council’s Sub-committees, Listing in particular.

Listing of investment funds, continued on the same trend commenced in 1998, while the commencement of refurbishment works on the Garrison Church to house the new premises of the Exchange necessitated considerable involvement of the Premises Sub-Committee. The Marketing Sub-Committee was responsible for drawing up a Marketing Strategy for the Exchange which was to be implemented during the following 18 months.

The Annual Report and Audited Financial Statements of the Exchange for 1998 were presented to licensed Members on 24 March 1999, at the Special Meeting, convened in terms of Section 9(iv)(a) of the First Schedule of the Malta Stock Exchange Act, 1990 (Cap. 345). In the Report, the Chairman touched briefly upon the developments that had taken place within the Exchange during the past year and also made reference to major projects envisaged for the next twelve months, the most important being the commencement of works on the new premises, upgrades to both the Depository and Trading Systems in view of the necessity to meet Y2K compliance requirements and the eventual move, in the year 2000, to remote (screen based) trading.

In May the Minister of Finance acting in terms of Section 20 of the Malta Stock Exchange Act, 1990 (Cap. 345) appointed the Malta Stock Exchange Tribunal for a period of three years. The Malta Stock Exchange Tribunal is composed of Dr Pierre Lofaro LLD as Chairman and Messrs Frank Bonello FCIB and Mario Bonello ACIB, as Members.

The Tribunal had its first sitting on 8 July 1999 when it met to consider a report prepared by Dr Toni Abela on the 24 May 1999 on behalf of the Association of Minority Shareholders of Mid-Med Bank plc and which was presented to the Tribunal in terms of Section 26(2) of the Malta Stock Exchange Act, 1990 (Cap. 345). In his report, Dr Abela stated that the suspension of trading in Mid-Med Bank plc shares gave rise to suspicions of "irregular practices in Exchange dealings" and that the undue length of the suspension was detrimental to the interests of his clients. On its part the Exchange maintained throughout that it had acted in the best interests of the general body of investors, existing and potential, in ensuring that all price-sensitive information is accessible to all.

The Tribunal met seven times and during the final sitting held on 13 January 2000 the Association withdrew its case. In a joint statement issued by the Association and the Exchange, the Association declared that it was accepting the explanation given by the Exchange and although it still held reservations about the duration of the suspension, it understood that in this particular case, the Exchange had acted in a prudent manner.

During 1998, the Exchange had undertaken a review of its organisation, hierarchy and procedures with a view to establishing a new structure that would better reflect the needs of the organisation. This re-structuring necessitated the creation of new posts and offices, foremost among which was the creation of the post of Chief Executive with effect from 1 January 1999 and the setting up of the Research and Development Office. New members of staff were also required to fill existing and new vacancies brought about by the new structure. As a result, during 1999 and the beginning of 2000 the Exchange embarked upon an intensive recruitment drive. In fact, during 1999, five (5) new members of staff were recruited to work in various offices of the Exchange bringing the staff complement at the end of 1999 up to a total of 32. A Manager resigned at the beginning of 2000, while another six (6) new staff members, were scheduled to commence employment with the Exchange at the start of the new year, mostly to strengthen the Compliance Office complement and the Central Securities Depository.

The re-structuring and re-organisation of the Exchange is an on-going process, particularly in view of the rapid developments that are taking place within the organisation. The Exchange has in fact commissioned two independent audits covering the regulatory aspects of the Exchange and IT systems and other related procedures, in order to ascertain stan-dardisation of processes and level of competencies.

International events, including conferences, seminars and workshops continued to be well-attended by Exchange staff which besides enabling participants to broaden their knowledge of the topics covered also continued to prove ideal opportunities for the exchange of ideas and discussion of mutual problems and difficulties.

International conferences attended during 1999 included the following:

• Global Offshore Funds

• Fund Management

Opportunities in Italy

• European Stock Exchanges- Strategies, Trends and Challenges

• The Changing Face of

European Fund Regulation

Besides attending overseas conferences, Exchange staff are also encouraged to participate in local conferences and during the year under review, management and staff attended several of these conferences, which covered among other topics, the EU, arbitration, and Euro-Mediterranean Linkages.

In view of the planned upgrade to the share registration system, the Assistant General Manager, Mr Martin G Farrugia and the Senior Manager IT, Mr Simon Zammit, visited Estonia, to view the new version of the system, Depo 2000, at a site where it was already installed and active.

Dr Elizabeth Mousu’, Assistant Legal Officer, formed part of a Maltese delegation from within the financial sector, which visited Brussels on an EU familiarisation visit. Several discussions were held with EU officials regarding all the changes in legislation that were required in connection with Malta’s application for full membership of the Union. At the same time, delegates were also given the opportunity to visit EU Headquarters and get to know the workings of the Union at closer quarters.

The Exchange continued in its efforts to encourage staff to continue training and acquire further qualifications in fields related to the capital markets and the stock exchange in particular. Most of the local training was done externally which, besides covering the usual financial subjects, included also IT training. In-house training included induction courses for new recruits and the training of staff on the new trading and depository upgrades. Training on the new trading system also included all stockbrokers and their accredited representatives.

The highlight of the year for the Malta Stock Exchange was without doubt, accession to full membership of the Federation of International Stock Exchanges (FIBV) in October.

The FIBV is the world body for stock exchanges with 52 member bourses covering nearly all of the world’s equity market capitalisation. In addition, the FIBV has 14 Affiliate and 35 Corresponding securities markets. Membership of this prestigious organisation is an uncontested certificate that an exchange has attained internationally recognised standards in the field of securities markets.

The Malta Stock Exchange’s relationship with this international organisation dates back to 1988 – even before the Exchange was set up, when the FIBV’s assistance was sought regarding legislation, rules, etc. that would govern the soon to be set up institution. Then, when the Exchange was set up in 1990, it became a Corresponding Member and later on advanced to become an Affiliate Member, and could call on the considerable expertise of the Federation and its Members, should this be required.

As the Malta Stock Exchange further developed, in particular as it progressed to electronic and then to daily trading, it was considered appropriate to commence the process towards attaining full membership. This involved a rigorous screening process, spanning almost 18 months, which included the submission of an extensive report giving in-depth information regarding all the operations and functions of the Exchange as well as a fact-finding visit by the Secretary General of the FIBV, Mr Gerrit de Marez Oyens, in April. Following his report to the Executive Committee another delegation visited the Malta Stock Exchange in August. The Secretary General headed the dele-gation which also included Mr Patrick Morton, Head of Listing Policy at the London Stock Exchange and Mr Alvaro Mancera, Director for International Affairs at the Mexico Stock Exchange. The delegation completed the due diligence exercise with regards to the Exchange's application. The positive recommendations of the examiners to the Executive Committee were eventually endorsed by the General Assembly leading the way for the Malta Stock Exchange's acceptance as a full member of the FIBV.

In November, the Malta Stock Exchange was invited to become a member of the FIBV’s "Working Committee" as a representative of emerging markets, a further confirmation, if such was needed, of the reputation the Exchange has gained not only locally but also internationally. The Working Committee is defined as the "backbone" of the FIBV and the platform where high level staff of member exchanges meet to discuss developments, share ideas and discuss business issues bilaterally.

At the reception hosted by the Malta Stock Exchange to celebrate the occasion, the Minister of Finance, the Hon Mr J Dalli, pointed out that becoming a full member of the FIBV was neither automatic nor easy. However, the years of constant development in the quality of the Exchange’s operations was an important contributory factor for the Exchange to take its place with other securities’markets of repute. He continued that the Malta Stock Exchange’s new status augured well not only for the Exchange itself but also for Malta as an international financial centre.

Throughout 1999, senior officials of the Exchange represented the Exchange at the regular and annual meetings of the international organisations of which the Exchange is a member.

In October, the Chairman and the Chief Executive attended the Annual General Meeting of the FIBV in Bangkok, when the Malta Stock Exchange was granted full membership. As a full member and member of the Working Committee, the Malta Stock Exchange is now able to participate fully in all the meetings held during the FIBV’s Annual General Meeting.

In May, the Chief Executive, Mr Paul J Spiteri, attended in Lisbon the General Assembly of the International Organisation of Securities Commission (IOSCO), while Mr Mark A Guillaumier, General Manager attended both the Spring and Autumn Meetings of the Emerging Markets Forum of the Federation of European Stock Exchanges (FESE) held in Lithuania and Poland respectively. The FESE is an organisation for Stock Exchanges of European Union Member countries. However, it is now extending its membership base to include also Exchanges of those countries who are progressing with their application to join the European Union. Given Malta’s current status in this respect, the Malta Stock Exchange has started to explore the possibi-lity of becoming a member of FESE.

For the first time since it became a member in 1994, the Malta Stock Exchange was represented by the General Manager at the Annual Meeting of the European Capital Markets Institute (ECMI) held in Spain. This Institute was set up to carry out research on European Capital Markets and was established as a joint exercise between FESE, the Federation of Financial Analysts Societies (EFFAS) and the International Securities Market Association (ISMA).

In line with the Government’s EU policy, the Malta Stock Exchange set up an EU Unit to deal with the current on-going exercise on EU issues and to be prepared for any eventual accession negotiations with the Union. The EU Unit at the Exchange is made up of the Legal Officer and representatives from Research Office and Corporate Services Office under the guidance of the Chief Executive. The EU Unit is responsible for reviewing the acquis and advising the Council on relevant matters that need to be reviewed to bring them in line with EU Directives and for keeping the Council up to date on what is taking place with regard to the screening process. At the same time it is also responsible for preparing the necessary PACMAN reports and for liaison with the EU Directorate. On its part, the Council has commenced discussions on any necessary revisions to the legislation and regulations that are required.

After the completion of the designs early in the year and approval by the Premises Committee, and, after obtaining all the necessary permits from the Planning Authority, refurbishment works on the Garrison Church at Castille Place, Valletta, which is to house the new premises of the Malta Stock Exchange, commenced early in June with the excavation of the site.

In designing the new premises, Architecture Project, the architects responsible for the design and project management of the refurbishment works, have come up with a design, that although very modern in concept, has done nothing to compromise the considerable historical aspects of the site. The Architects undertook studies and research, both locally and overseas, to discover as much as possible about the site in order to ensure that everything of historical value was retained, as far as possible, and that the outer shell of the building which is being retained, can be restored to its original state. In fact, a large part of the project will be involved with restoration, not only of the building itself but also of the surrounding area, principally the main gate to the Upper Barrakka Gardens. The wooden trusses which support the roof of the building and which are unique in Malta, will be exposed and restored to their original state. Part of the surrounding bastion, which was uncovered during the excavation stage, will be incorporated in the design of the lower floor of the new premises.

Excavation works have been concluded and works have commenced on the surrounding areas in the Barrakka Gardens. Structural works, consisting mainly of the insertion of a steel frame within the original walls to support the building, are scheduled to commence during the first quarter of the year 2000 and completion date of the project is envisaged in the first half of 2001.

Exchange Operations

Market turnover on the Exchange during 1999 reached a value of Lm190.5 million spread over 242 trading sessions, i.e. an average turnover of Lm0.79 million per trading session. This turnover value represents a year-to-year increase of almost Lm56 million, equivalent to 41% on the previous record high of Lm134.8 million registered during 1998.

The increase in turnover on the market was reflected in the number of deals effected during 1999 which reached a total of 16,839; almost twice the number of deals executed during the previous year.

The market was this year dominated by high levels of activity in the equity sector, where turnover rose from Lm21.2 million in 1998 to Lm137.6 million during 1999, accounting for over 72% of the market turnover for the year.

The equity sector itself was dominated by the transfer of the Government’s majority shareholding in Mid-Med Bank plc in June to HSBC. This deal accounted for a turnover of Lm80 million in the equity market. Overall, HSBC shares accounted for 62% of equity turnover in 1999, Bank of Valletta plc shares for 12% and Maltacom plc shares for 18%.

On the other hand, dealing in Government stocks decreased considerably during the year under review when compared to 1998 figures, falling from Lm112 million to just under Lm51 million, a drop of over 55% from the previous year’s value. In terms of turnover the 5.9% MGS 2009 (ii) and the 5.6% MGS 2005 (B) were the most heavily dealt in stocks accounting for 15% and 12% of turnover in this market during the year. In terms of the number of deals, the most heavily dealt in stock was the 7.8% MGS 2018, accounting for over 7% of Malta Government stock market turn-over, spread over 283 deals.

In the Corporate Bond sector, turnover rose by 33% when com-pared to 1998 reaching a total market value of just over Lm2 million, spread over 628 deals, as compared to 459 deals during the previous year.

Lm10,000,000 Corinthia Finance plc 6.7% Bonds 2009 were listed in October 1999 and mainly accounted for the year’s increased activity in this market, while turnover in the remaining corporate bonds remained largely unchanged from the previous year. Gasan Finance Co Ltd also issued a further two new bonds with a nominal value of Lm7,000,000 in May 1999 upon the redemption of the 6.5% Gasan Bond 1998/99.

The Malta Stock Exchange commenced publication of the Ordinary Share Index in July 1996 using the "constant weight" method of calculation. The Index calculates on a daily basis the value of a basket of listed ordinary shares which is then compared with the value of the same basket of ordinary shares on the base date, in this case taken as 27 December 1995, with a base value taken as 1000

A Share Index is an important statistical tool that enables investors and other market participants to measure the performance of their portfolio over a given period of time. Whilst there are various methods used by stock exchanges to calculate share indices, the method adopted by the Malta Stock Exchange up to 1999 was the "constant weight" method whereby the weighting factor for each share participating in the Index is a constant number. This means that no account is taken of the actual number of listed shares.

With the continued expansion of the market, the Exchange felt that a revision in the methodology of computing the Index was opportune, and after consultation with Members decided to change over to the capitalisation weighted index. In this method a weighting is given to each particular participating share which reflects its relative importance in the ordinary share market. As a result, more emphasis is placed on the value of the overall wealth invested in the market and to the fluctuations in its aggregate value which come about as a result of changes in share prices.

The Malta Stock Exchange Share Index rose steadily during the year, except for a slight dip during the summer months, ending the year at a value of 3278.49, over 2000 points higher than the end 1998 value of 1210.79. The largest increase in the value of the Index took place during the last quarter of the year, rising over 1300 points during the period from the end of September 1999 value of 1893.12.

This was a reflection of the overall rise in prices of equities throughout the year and in particular the large hike in prices of equities during the last few weeks of the year. Whilst trade weighted average prices of Bank of Valletta plc’s shares, HSBC Malta Bank plc’s shares and Lombard Bank (M) plc shares registered gains of 175%, 224% and 172% respectively throughout the year, those of Maltacom plc shares, Middle Sea Insurance Shares, Suncrest Shares and Farsons shares gained 172%, 107%, 51% and 20% respectively during the same period under review.

The market capitalisation of securities listed on the Exchange (excluding Collective Investment Schemes) reached a total of over Lm1,596 million, up from Lm991.1 million registered at the end of the previous year. For the first time in 1999, the market capitalisation of equities listed on the Exchange exceeded that of listed Government Stocks, primarily again due to the large hike in prices of equities towards the end of the year. Market capitalisation of equities accounted for almost 50% of total market capitalisation at the end of the year, equivalent to over Lm790 million. Market Capitalisation of corporate bonds amounted to Lm41 million, up from Lm26 million last year, mainly due to the listing of Corinthia Finance plc bond, while market capitalisation of Government Stocks rose by almost Lm100 million, to end the year at a value of over Lm764 million.

At the end of the year, there were also nineteen (19) local Collective Investment Schemes listed on the Malta Stock Exchange (apart from 99 foreign investment schemes) with a market capitalisation value of over Lm233 million.

The highlight of the trading year was the changeover from the Malta Automated Trading System (MATS) installed in 1996, to an upgrade of the same system, Horizon.

Horizon retains all the features of MATS including all those specially designed for our requirements, however, it also incorporates many new market features and rules which are parameter driven and can be gradually adopted when needed. The main reasons for upgrading to Horizon are that :

The new upgrade was introduced in December 1999 following the appropriate training of Members and their Accredited Representatives together with Exchange staff.

No changes were required in the rules governing trading, although slight adjustments were required to some procedures in order to achieve maximum benefit from the new upgrade.

Like MATS before it, Horizon is fully interfaced with the Clearing and Settlement System and to the upgraded central registration system, Depo 2000. The scenario is, therefore, now set for testing to commence in earnest towards the introduction of remote trading scheduled for the first half of 2000.

The Council of the Malta Stock Exchange, acting in terms of Section 30 (5) of the Malta Stock Exchange Act (Cap. 345), suspended trading in the ordinary shares of Mid-Med Bank plc, pending further clarification in respect of the sale of the Government’s shareholding in Mid-Med Bank plc to HSBC. Trading in these shares was eventually resumed on 2 June 1999.

Later on in the year, the Council, again acting in accordance with the same section of the Act suspended trading in the ordinary shares of Middle Sea Insurance plc. Trading in these shares was resumed on the following day following the issue of necessary announcement by the Government regarding its intentions with respect to its holdings in this Company.

During the year under review the Council approved new Bye-laws setting up the Alternative Companies List (ACL). These are new listing rules which allow for the creation of a "second tier market". The introduction of these new rules will give certain companies the opportunity to list their securities on the Malta Stock Exchange and they are aimed specifically at companies which do not have all the necessary qualifications to seek a listing on the current Official List, such as, for example, new companies which do not have the necessary three year track record. It is the intention of the Council that second tier market securities would be traded every day and prices would be quoted daily, however, they would be separate from those companies admitted to the main listing board; i.e. those quoted on the Exchange's Official List.

Companies seeking admittance to the second tier market will go through a less rigorous listing process, however, once listed, such companies would be regulated by the Exchange to the same extent as those listed on the main board.

The Malta Stock Exchange has also issued a "Guide" to these new bye-laws explaining the salient points and answering common questions in this respect. The Guide has been distributed to Members, selected lawyers and accounting and auditing firms, as well as to over 1,000 local firms who might be interested in this new market.

The response from both practitioners and companies has been very encouraging. It is felt that the introduction of the second tier market will be a very good opportunity to increase investment choices both in the equity and corporate bond markets.

In a further effort to encourage primary equity listings, towards the end of the year, the Council took the unprecedented step of removing all initial listing fees (which could reach a maximum of Lm25,000) on such listings on both the Official List and the ACL.

During 1999, six (6) Government Stocks were admitted to the Official List, with a total nominal value of Lm125,564,000. These were, namely, 5.9% MGS 2007 (II), 5.6% MGS 2005 (II) (two tranches), 7.0% MGS 2009, 5.9% MGS 2009 (II), 6.6% MGS 2019 (the longest term stock admitted to the Official List) and the 5.9% MGS 2010.

During the year under review, three (3) new corporate bonds were also admitted to the Official List, namely, Lm3.5 million 6.5% Gasan Finance Co Ltd 2006/9, Lm3.5 million 6.15% Gasan Finance Co Ltd 2003/4 which were admitted to the Official List in May and Lm10 million 6.7% Corinthia Finance plc 2009 was admitted to listing during October 1999.

The following local and overseas funds were admitted to the Official List during the year under review :

There are now nineteen (19) local and ninety-nine (99) overseas Collective Investment Schemes listed on the Malta Stock Exchange.

During 1999 the first corporate bond to be listed, the 6.5% Gasan Finance Ltd Bond 1998/99 was redeemed in May and replaced by two new bonds with a total nominal value of Lm7 million. The SFC 8.5% Pref. shares were also redeemed.

Throughout the year five (5) Government Stocks were redeemed, amounting to a total nominal value of Lm46.75 million.

Following the termination of the Fund, 21 share classes of Midland Offshore Global Investments Funds Ltd were removed from the Official List in September 1999. These were subsequently replaced by 21 share classes of HSBC Global Investments Funds Ltd.

Later on in the year the listing of 2 share classes of Fidelity Funds were suspended pending new developments and further clarifications. These listings were subsequently cancelled early in the new year.

The increased volume in trading, especially in equity trading, was reflected in the expansion of the workload of the Central Securities Depository (CSD). In fact, a good number of the new staff employed during 1999 were deployed to the CSD to help cope with this increase.

The number of accounts held within the CSD decreased slightly from 101,556 at the end of 1998 to 98,754 at the end of 1999. This decrease was due mainly to the redemption of some securities and the amalgamation of various accounts.