Presentation to the Danish Stockbrokers Association Olof Neiglick, CEO

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A new way of trading Nordic equities

• Presentation to the Danish Stockbrokers
  Association Olof Neiglick, CEO
• October 1, 2008

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Exchange and Clearing Industry in transformation
Low-cost entrants
MIFID and Regulation Breakup of thetraditional
value chain
Technology DMA Algorithmic trading Latency race
CCP introduction Facilitating x-border
trading Regulators pressing for interoperability
Exchange consolidation
NYSE-Euronext
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Burgundy - cutting costs and providing advanced
functionality

• Burgundy primary objectives

Nordic perspective
Strengthening the Nordic region as a financial
center and supplier of public equity for Nordic
companies long term
Burgundy will be a cost effective alternative to
existing trading venues
Cost
Platform functionality and performance
Burgundy will provide a fast, low latency
solution offering advanced trading functions for
algo trading
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Three value creation levers for the Nordic
industry
Efficient execution
Market information
CCP
Speed Low latency Localized orderbooks
Level 1 and Level 2 live market data
Cooperation with 3rd party C/House
In-scope for Q2/2009 delivery
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Nordic exchange revenue estimates equities
(MSEK)
Source Oslo Bors,/OMX reports, own analysis
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Alternative venues trading fees vs incumbents
80reducedfee
Avg bps / trade, Source FPK Research, Wagner
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A Pan-Nordic platform
Helsinki

• High-performance matching engine
• Low latency
• Algo-friendlyfunctionality
• Localisedmarket model

Burgundy
Oslo
Stockholm
Copenhagen
London Hub
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Instrument universe available for trading

• Cash equities
• Rights, interim shares
• Warrants
• Structured notes
• ETF - Currency denominated as in home market

800 equities - Large/Mid/Small caps
Gradual rollout starting in Q2/2009
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Regional members large potential
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A large number of Nordic banks and brokers has
joined or presented a positive view on Burgundy.
Burgundys goal is that its shareholders will
distribute more than 50 percent of the total
trading volume in the Nordic region
Source Inner circle, OMX statistics, SSX cash
market, total traded volume. Outer circle, active
traders with more than 2 percent of local main
exchange volume.
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Burgyndy structure
Shareholders
A group of Nordic banks and securities houses are
founding members and equal investors of Burgundy
Two independent directors, one of which is to be
Chairman. Up to 9 directors from shareholders
Board of directors
CEO
Operational since September
Legal framework
Application filed with the Swedish Financial
Supervisory to operate an MTF in the Nordic
Countries.
Financing
Capital raised from existing shareholders in
September
Trading platform
Cinnober Trade Express
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Burgundy organisation
Open on all Nordic trading days 25 FTEs
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Clearing Settlement
Matching
Member
NCSD
ORC
Order Settlement
Burgundy
Trading
VPC
OMX
VP
VPS
Back office
FIX
FRONT

• Burgundy will keep current means and provisions
  for clearing and settlement no changes as
  compared to OMX / OSE
• However, introducing a CCP would have certain
  advantages and Burgundy will follow market
  development closely
• The total number of transactions is expected to
  increase as a result of market fragmentation and
  lower transaction costs

Transaction processing after the trade is made
will not be changed/impacted as a result of
Burgundy
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Anyone for cash market clearing ?
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2009 will offer increased complexity
Trading
CCP
Settlement
NCSD
OMX Exchanges ?
OMX Exchanges
LCH Clearnet
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How to avoid a spaghetti solution ?
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Important evaluation criterias for choosing a CCP

• Support MTFs and legacy venues
• Risk sharing or Risk Compliant ?
• Business model (Profit maximisation or Cost
  allocation)
• Experience
• Time to market

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Burgundys position

• Mandatory CCP increase attractiveness to members
• Different needs depending on member type
• Need to respect large market participants time to
  market due to hard-wiring of retail STP flow

Burgundy can handle BOTH solutions
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Trading on Burgundy starts during first half of
2009
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Summary of Burgundy offering

• Burgundy is a new Nordic MTF that will be
  launched during first half of 2009
• Burgundy aims at
• Keeping order matching in the region
• Introducing competitive trading solutions in the
  region
• Launching a price competitive, advanced
  functional trading platform during the first half
  of 2009
• Current shareholders are Avanza Bank, Carnegie,
  Evli, Handelsbanken,Kaupthing, Neonet, Nordnet
  Bank, SEB, Swedbank, Öhman and HQ

Burgundys vision is to be the leading platform
for trading Nordic shares
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join_at_burgundy.se
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Contact Details

• Olof Neiglick, CEO
• olof_at_burgundy.se Voice 46-705545224
• Assistant
• Julia Hadmark Voice 46-850314375
• julia_at_burgundy.se