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The Newsletter of the Asian Securities Analysts Federation Inc.

Quarterly Issue, March 2008

Secretariat NewsASAF Conference and AGM in New Delhi

The ASAF 2007 Conference was successfully held on Friday, 23 November 2007, at Le Meridien New Delhi in New Delhi, India, kindly hosted by ICFAI University, Tripura. The conference featured excellent speeches by local regulators, practitioners, academia and speakers from overseas, including Ms. Angelina Kwan of the Hong Kong Securities Institute (HKSI) and Mr. Shinichi Yoshikuni of Shinko Securities Co. Ltd. introduced by the Security Analysts Association of Japan (SAAJ) (see article by the ICFAI).

In conjunction with the conference, ASAF held various meetings such as the Education Committee, Advocacy Committee, Communications Committee, and Executive Comm-ittee meetings as well as the Annual General Meeting. In addition to regular agenda items such as approval of the fi nancial statements and budgets, the AGM elected the following six as Executive Committee members: Dr. Bill Kwok (HKSI), Mr. Kiyoto Hagiwara (SAAJ),

Mr. Mike Willis (FINSIA), Dr. Lin Yixiang (SAAC), Mr. Sanjay Ramchandani (ICFAI), and Mr. Tolmas Wong (CFAS). At the subsequent new Executive Committee meeting, Dr. Bill Kwok was elected Chairman and Mr. Kiyoto Hagiwara Deputy Chairman. Their term is for two years until the AGM in 2009.

The AGM also discussed how to re-vitalize ASAF, and decided to form a working group to consider appropriate measures. To this end, it is anticipated that the working group will fi nalize a draft to revise the Constitution which can be approved at the next AGM to be held around October-November 2008.

Interim ExComm meeting in Hanoi

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ASAF Newsletter Quarterly Issue March 2008 | Page : 2

An interim ExComm meeting was held on Saturday, 29 March, at Hotel Nikko Hanoi in Hanoi Vietnam. Taking this opportunity, ExComm members visited the State Securities Commission of Vietnam and the State Bank of Vietnam to discuss the possibility of a Vietnamese entity becoming a member of ASAF as well as the ACIIA®. Details of the ExComm meeting will be reported in the ASAF June Newsletter.

ACIIA® NewsCIIA® Exam: March 2007 SessionThe CIIA® March exam session was successfully held on 7-8 March at 29 cities: Vienna, Brussels, Beijing, Shanghai, Taipei, Paris, Frankfurt, Hong Kong, Kolkata, Gurgaon, Hyderabad, Mumbai, Bangalore, Pune, Tehran, Milan, Tokyo, Osaka, Seoul, Moscow, Madrid, Barcelona, Andorra, Valencia, Buenos Aires, Stockholm, Interlaken, London, and New York catering to many candidates from 17 countries.

Exam site in Tokyo, Japan

26 March 2008ASAF Interim Executive

Committee MeetingHanoi, Vietnam

25-26 June 2008ACIIA® Council Meeting

ACIIA® Annual General MeetingParis, France

The September 2008 exam session is scheduled for 19 September in Africa, Europe, and North and South America, and 20 September in Asia.

ACIIA® Council Meeting and Annual General Meeting: June 2008, Paris, FranceThe ACIIA® Council Meeting will be held on 25-26 June in Paris, France.

13 November 2008ACIIA® Council MeetingBuenos Aires, Argentina

November 2008ASAF Education Committee MeetingASAF Advocacy Committee Meeting

ASAF Communications Committee MeetingASAF Executive Committee Meeting

ASAF Annual General MeetingASAF 2008 Conference

TBA

Calendar 2008

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Page : 3 | Quarterly Issue March 2008 ASAF Newsletter

Member’s Regional NewsChina – SAACNewsletter for Chinese Capital Market

1. The total number of listed companies in Shanghai and Shenzhen Stock Exchange amounted to 1550 as of the end of December 30, 2007. The market capitalization reached 32.17 trillion RMB and the trading value reached 9.31 trillion RMB. The total amount of fund raised through the stock market aggregated to 772.8 billion RMB. The Shanghai Composite Index closed at 5261.56 points, up to 99.66% while Shenzhen Component Index closed at 17700.62, up to 166.29%. The number of Fund Management companies reached 59, with a total of 3.28 trillion RMB AUM.

2. China International Capital Corporation (CICC) Limited issued Collective Asset Management Product in China on January 16 of 2008. This is the fi rst QDII product issued by Chinese securities fi rms. CICC aims to raise 4 billion US dollars through this IPO and a total of 5 billion RMB in its duration. The minimum amount for an investor to subscribe is 100000 RMB and the minimum for added amount is 10000 RMB. Regarding on the stock allocation, the maximum percentage in HK stocks to be invested is 85% of the whole asset and the minimum is 25%.

3. Securities Association of China established exclusive fund for investor education which aims for public benefi t related to investor’s education. Guojin Securities Co., Ltd. Contributed 1 million RMB to the Fund as the initial part of the Fund.

4. Securities Association of China carried out CIIA® exam in Beijing, Shanghai and Shenzhen successfully on March 8, 2008. This is the fi fth exam in China since March, 2006. The total number of registered candidates for exam I and exam II was 139, among which 88 for exam I and 51 for exam II, slightly above that in last year.

As of 2007, there were 37 successful candidates who obtained their CIIA® certifi cates. CIIA® exam is the most advanced-lever exam held by SAC so far. Those who got the certifi cates demonstrated great analytical and practical ability in economics, accounting and fi nancial statements analysis, valuation and analysis for stocks, fi xed income products and fi nancial derivatives, corporate fi nance and investment portfolio. From the current response, it is found that many SAC members and practitioners from other industries have realized the signifi cance of CIIA® exam for the area of investment and quite a number of CIIA® certifi cates holders have already been engaged in much more important jobs.

Hong Kong— HKSIPDFM launched in Shanghai

Towards the end of February HKSI Chief Executive Mr Gary Cheung fl ew up to Shanghai and launched its Professional Diploma in Financial Markets (PDFM) in that city in response to market demand. The Institute has signed an agreement with the East China Normal University (ECNU), which will, in conjunction with the HKSI and HKU SPACE, administer this programme, by providing training and conducting the examination.

The PDFM is recognized by Hong Kong’s Securities and Futures Commission (SFC) as meeting its requirements. The PDFM is also accepted further afi eld including The Association of Certifi ed International Investment Analysts (ACIIA®), The Investment Dealers Association of Canada, The Association of Chartered Certifi ed Accountants, The Napier University in Scotland, and The Curtin University of Technology in Australia.

Since its launch in 2006, the Diploma has been well received by the market and proved to be very versatile, providing a one-for-all qualifi cation to work in the Hong Kong fi nancial industry. Around 500 students have enrolled in the examination in Hong Kong.

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All this gives us a good opportunity to market the Diploma in China. Unlike other international qualifi cations, the PDFM has a Chinese-language version, which means that it has a much wider audience. The launch of the qualifi cation in Shanghai will involve the provision of both structured training and the examination itself. The Institute sees it as in keeping with our vision to provide a high-quality programme to facilitate the raising of standards in the fi nancial industry.

Chairman’s Cocktail At the annual Spring Cocktail held exclusively for members, Dr Au King-lun, Chairman of the HKSI, shared his vision of the strategic priorities for the Institute moving forward to a new decade. Dr Au said that the Institute is committed to providing the necessary assistance to enable talented individuals to develop their careers in the fi nance sector. “Looking ahead, the Institute will continue to provide the appropriate professional training and qualifi cations to help widen and deepen the talent pool. This is fundamental to HK’s success as an international fi nancial centre – and our core mandate,” Dr Au reiterated.

The cocktail evening was also an important occasion for the HKSI Outstanding Achievers. The Outstanding Achievers Awards scheme was launched in 2005 to recognize the top performers in the HKSI Licensing Examinations (LE). There are two categories of awards: “Candidates of the Month” and “Candidates of the Year”.

LE candidates who passed an examination for the fi rst time and achieved 95% or above of the total score in each monthly examination session are recognized as “Candidates of the Month”. For 2007, there were 304 winners in this category, and the Institute published their names on the HKSI web site to recognize their accomplishments. “Candidates of the Year” are those who score the highest mark in each of the LE Papers during a calendar year. For 2007, there were 29 winners in this category.

The LE was developed for the industry by the industry. It aimed at upholding and improving the industry’s standards by equipping candidates with the necessary skill set that would allow them to fulfi ll and discharge their responsibilities as securities and futures market professionals.

Speaking at the Awards Presentation Ceremony, Ms Barbara Shiu, Vice Chairman of the HKSI, said: “To be a top performer in these exams is indeed no easy task and is an acknowledgement not only of the candidate’s regulatory knowledge but also of their commitment to attaining high professional standards in their chosen profession.”

Mr Matthew Harrison (HKEx), Dr Au King-lun (HKSI) & Mr Paul Kennedy (SFC) at the Cocktail

Candidates of the Year with the HKSI Board Member

Mr Paul Kennedy (SFC), Mr Gary Cheung (HKSI) & Dr Bill Kwok (HKSI) at the Cocktail

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Reaching out

It is important for us to reach out to the next generation and groom the new talent of the industry. Last November two of our experienced practitioners, Ms Samantha Ho and Mr John Williamson, addressed close to 150 students on the topic “An Insider View of Developing Your Career in the Financial Industry” at a Career Talk held on our premises.

Every now and then we go to universities ourselves and speak to students on campus, too. In January Mr Gary Cheung met a delegation of nearly 20 MBA students from Shanghai University which has a link with the CFA Institute, and explained to them the career prospects in the local fi nancial industry. That same month Mr Steve Chiu of our membership committee gave a talk about mutual funds in Greater China to business students and alumni at City University of Hong Kong.

In February the Institute took part in the Careers Expo which is organized each year by the Trade Development Council at the Hong Kong Convention and Exhibition Centre. This gave us a chance to introduce the fi nancial services industry to 200,000 secondary school students and university undergraduates.

These are just a few examples of the way we are trying to communicate our message to young people. Throughout the year the Institute seeks to cater to their needs, for example through career talks, members’ lectures, our scholarship programme, our new entrants’ training programme, etc.

Overall the Institute is trying to consolidate the foundations of the HKSI so that it can be the premier organisation which offers training courses related to Hong Kong industry. The Institute wants to extend our activities, especially to north of the border, where we hope to export some of our expertise. After all, we share a lot of common values and can talk on the same wavelength.

India - ICFAI2007 ASAF Conference hosted by ICFAI University

The 2007 ASAF Conference on the theme Asian Capital Markets – The Way Forward was held on 23 November 2007 at Le Meridian, New Delhi hosted by ICFAI University, Tripura. Mr M Damodaran, Chairman, Securities and Exchange Board of India (SEBI) inaugurated the conference, which was attended by about 200 delegates from various countries in the Asia-Oceania region.

The inaugural address by Mr Damodaran set the key note for the conference touching on several issues of immediate as well as far reaching relevance to the capital market. Talking about the fast growing markets in Asia, he said that they need to see far more attention paid to reducing asymmetry of information and that is where researchers and analysts come in.

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Mr Shinichi Yoshikuni, Senior Advisor, Shinko Securities, Japan, Mr. C.S. Mohapatra, Director, Capital Markets, DIV, Min. of Finance, Govt. of India, Ms. Angelina Kwan, Director, Head of Legal & Compliance, Cantor Fitzgerald, Mr B S Raghavan, IAS retired, Columnist and Author, Mr N K Garg, Chief Executive, Sahara Asset Management Co, Mr T S Harihar, Vice President–Equity Derivatives, Karvy Stock Broking and Dr Bijan Roy, Controller of Examinations, ICFAI University.

There were fi ve technical sessions in the conference in which the discussions were led by presentations from eminent professionals Viz.,

Mr B S Raghavan, IAS retired, Columnist and Author

Ms. Angelina Kwan, Director, Head of Legal & Compliance, Cantor Fitzgerald,Mr Shinichi Yoshikuni, Senior Advisor,

Shinko Securities, Japan.

Welcoming the delegates Prof Subhash Sarnikar, Chancellor, ICFAI University, Tripura said that the conference theme “portrays the collective refl ection of achievements and aspirations of the capital markets industry in this part of the world.” He also recounted that this was the second time that the conference is being organized in India.

Dr Bill Kwok, Chairman, ASAF in his opening remarks shared his vision of ASAF and also spoke about its achievements and the road map ahead. He said that integration within Asia has promoted complementary and yet competitive development and ASAF has “assumed an important role in facilitating and promoting constructive dialogue of regional societies.”

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The concluding remarks for the conference were presented by Prof O P Gupta, Director, IBS-Gurgaon. In all the sessions, the quality of presentations and discussions was very high.

Opening Remarks Kiyoto Hagiwara President and CEO of SAAJ

Session 1“New Frontiers in Asset Management”-An overview of new trends in asset Robert D. Arnott, ChairmanResearch Affi liates, LLC

Mr T S Harihar, Vice President – Equity Derivatives, Karvy Stock Broking

Presentations and discussions were conducted in English or Japanese with simultaneous interpretation for both languages.

The conference also provided a platform to professionals from several countries to exchange notes. The conference, in all aspects, fully met the promise set out at the start by the Conference Director Prof Manas Chakravarty that it will be a “day of intellectual engagement and professional networking.”

The conference was preceded by the ASAF AGM and other meetings and after the conference a day long sightseeing program was organized where the ASAF delegates were taken around the city of Delhi.

Japan — SAAJRecent Events

20thSAAJ-CFA Institute/CFAJ (CFA Society of Japan) Joint Seminar12th – 14th March Tokyo Conference Center, Shinagawa

“New Challenges in Fund Management”Since 1989, SAAJ has held an annual seminar in co-operation with AIMR (currently CFAI) focusing on various investment topics. This year, this seminar was successfully held with more than 100 participants.

Speakers and instructors, from among top researchers and experienced practitioners in Japan, the US, and other countries, explored new trend and strategies in fund management.

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The Direction of the Investment ProfessionJeffrey J. Diermeier, CFAPresident and CEOCFA Institute

Session 3Liability-driven Investment Strategies for Pension Funds

Roman von AhFounding Partner and CEOSwiss Rock Asset Management AG

Session 4Asset Allocation in an Individual’s Life Cycle - Designing Effective Retirement Strategies

Ranji H. Nagaswami, CFASenior Managing Director and CIOAlliance Bernstein Investments

Session 5Panel Discussion DB versus DC Plans - Comparison of Behavior as Investors

Session 2Commemorative Speeches : “The Future Direction of the Investment Management Industry in Japan”Yukio Suzuki, CMAChairman, The Security Analysts Association of Japan Director, NOMURA HOLDINGS INC.

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Panelists:Seiji Ogishima, CMAManaging Director and Senior ConsultantFiduciary Management DepartmentNomura Securities Co., Ltd.Haruka Urata, CMAConsultantTowers PerrinRoman von AhFounding Partner and CEOSwiss Rock Asset Management AG

Moderator: Masaharu Usuki, CFAPrincipal and Senior Pension EconomistFinancial Research Group Pension ForumNLI Research Institute

Session 6New Approaches for Seeking Alpha

Richard M. Ennis, CFA Principal and Chair of the board of directors of Ennis Knupp + Associates

Session 8Investment in Real Estate Securitized ProductsTatsuo Kusanagi, CMASenior ManagerAsset Management DepartmentAlternative Investment GroupThe Sumitomo Trust & Banking Co., Ltd.

Session 7Understanding Hedge Fund Fundamentals and Trends

Ted Seides, CFACo-founder and Director of InvestmentsProtégé Partners, LLC

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Session 11Incorporating Debt Instruments – Asset Allocation and Risk Management

Session 12Panel discussion

New Developments and Challenges in the Investment Management Industry – After the Subprime Problem

Session 10Case Study General Discussion Asset Allocation Based on Various Alternative Assets for Pension Investment

Satoru Kimura, CMA, CIIAProfessor of Graduate School of Global Business, Meiji University

Panelist:Richard M. Ennis, CFAPrincipal and Chair of the board of directors of Ennis Knupp + Associates

Session 9Case Study: Group Discussion Asset Allocation Based on Various Alternative Assets for Pension Investment

Satoru Kimura, CMA, CIIAProfessor of Graduate School of Global Business, Meiji University

Sridhar BearlyManaging Director, Head of Europe ZAIS Group, LLC

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Disclaimer: Not for distribution in North America. Members’ regional news

supplied by ASAF members and ASAF takes no responsibility for the accuracy of

the articles or views expressed therein.

Published by the ASAF Secretariat, Contact: Kazumichi Karita,

c/o 5F Tokyo Stock Exchange Building, 2-1 Nihonbashi-Kabutocho, Chuo-ku,

Tokyo 103-0026, JapanTel: 81 3 3666 1576 Fax: 81 3 3666 5843

E-mail: [email protected] Website: www.asaf.org.au

Upcoming News/Events/Seminars

Below are some of events and seminars scheduled to be held during April - May 2008:

2008

4 April:Foreign Investors and Japanese Stock Masatoshi KikuchiChief Stock Strategist Merrill Lynch Japan Securities Co., Ltd.

15 April:Increasing Importance of Chinese Economy and Relationship between China and JapanShinichiro KannoAdvisorMizuho Corporate Bank

12 May:Convergence of International Accounting StandardsTatsumi YamadaBoard MemberInternational Accounting Standards Board

Toshio Goto, CMAPresident Mitsubishi UFJ Asset Management Co., Ltd.

Naho KimotoVice President, Global Investment StrategiesGoldman Sachs Asset Management Co., Ltd.

Mamoru TaniyaFounding Partner and CEOAsuka Asset Management, Ltd.

Moderator:

Hiroaki Kobayashi, CMAExecutive Offi cer and Deputy General ManagerPension Consulting DepartmentMizuho Research Institute

20 May:Capital markets under Islamic FinanceEtsuaki YoshidaManagerJapan Bank for International Co-operation

10 June:Russian Economy and EconomicRelationship between Russia and JapanYusuke ItoManagerJapan Bank for International Co-operation

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