FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT JUNE 2012
AMMAN STOCK EXCHANGE
The ASE has continued in 2011 with its
efforts, aiming at developing the market,
and increasing its efficiency.
Jalil Tarif
Chief Executive Officer
The year 2011 has witnessed many events
that had negative impacts on stock exchanges
around the world most notably the downgrade
of the sovereign debt rating of several
European countries due to the European
sovereign debt crisis, in addition to the
downgrade of the American sovereign debt
rating. Moreover, the Arab region has witnessed
a political turmoil that took place in several
Arab countries, these political distresses had
a negative impact on Stock Exchanges in
the region, even in countries whose political
environment wasn’t affected by that turmoil and
stayed stable, as in the case of Jordan.
HISTORY AND DEVELOPMENT
The Amman Stock Exchange (ASE) was
established in March 1999 as a non-profit,
private institution with administrative and
financial autonomy. It is authorized to function
as an exchange for the trading of securities.
The Exchange is governed by a seven-member
board of directors. A Chief Executive Officer
oversees day-to-day responsibilities and reports
to the board. The ASE membership is comprised
of Jordan’s 68 brokerage firms.
The history of securities trading in Jordan
traces its origins back to the 1930s. In 1976,
the Amman Financial Market was established
to create a regulated trading market. More
recently, as part of Jordan’s move to upgrade its
capital market, a Securities Law was enacted in
1997 separating the supervisory and legislative
roles from those of exchange operations. As
a result, the Jordan Securities Commission
(JSC) was created in the year 1997, the ASE
and the Securities Depository Center (SDC)
were established in 1999. The JSC supervises
the issuance of and trading in securities and
monitors and regulates the market. The SDC
oversees clearing and settlement and maintains
ownership records.
To provide a transparent and efficient market,
the ASE implemented internationally recognized
directives regarding market divisions and listing
criteria. It also adopted procedures for improving
regulatory effectiveness.
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On the other hand, the ASE managed to retain
the confidence of investors, and this was
reflected in the foreign investors’ ownership in
the ASE which stood at around 51%, and the
positive net investment of foreign investors.
In 2011, the ASE continued with its efforts in
developing the market, through updating the
technical infrastructure, and on the legislative
level, the ASE made amendments to the Listing
Securities Directives which aimed at keeping
the listing of the companies that are actively
being traded and getting rid of companies that
are not being traded. As for the performance of the ASE, the
Free Float Weighted Price Index went down
during 2011 by 15.9% to close at 1995 points
compared with its 2010 closing of 2374 points.
The trading value witnessed a decrease in
2011 and reached US$ 4 billion. The number
of transactions stood at 1.3 million transactions
while the number of traded shares reached 4.1
billion. With regard to the foreign investment in
the ASE, the net of non-Jordanian investments
for the year 2011 showed an increase of US$
111 million compared to a decrease of US$ 21
million during 2010.
The ASE is charged with:
• Providing companies with means of raising
capital by listing on the ASE,
• Encouraging an active market in listed
securities based on the effective
determination of prices and fair and
transparent trading,
• Providing modern and effective facilities and
equipment for trading, recording the trades
and dissemination of prices,
• Monitoring and regulating trading, in
coordination with the JSC as necessary, to
ensure compliance with the law, a fair market
and investor protection,
• Setting out and enforcing a professional
code of ethics among its member directors
and staff,
• Ensuring the provision of timely and accurate
information of issuers to the market and
disseminating market information to the
public. On March 22nd 2009, The ASE launched the
new version of the electronic trading system
NSC V900, this project is considered a quantum
leap for the concerned institutions as the
electronic trading system has now become
linked with the SDC systems and the JSC new
monitoring systems. The new version will help
develop the trading process at the ASE and
enhance the capacity of the electronic trading
system.
On March 26th 2000, the ASE launched an
automated order-driven Electronic Trading
System. The system is in compliance with
international standards and takes into account
the G-30 recommendations. This system also
offers brokers immediate access to stock prices
and orders and enables members to trade
remotely. The Amman Stock Exchange will embark
on a number of key projects that will ensure
maintaining the lead that the ASE has amongst
Arab and regional stock exchanges. These
projects can be summarized as follows:
• Continuing the construction works of the
Jordan National Financial Center.
• Continuing upgrading the technical
infrastructure.
• Launching new Indexes.
• Launching new financial instruments.
On May 2006, The ASE has activated a new
version of the electronic trading system (NSC
V2+), which comes as part of the efforts to
meet the increasing needs of the Jordanian
capital market and in order to raise the capacity
of the current electronic trading system to
accommodate the increase in the daily trading
volume.
On July 14th 2010, the ASE Launched the
Internet Trading service. This service is seen
as a major opportunity for a large number of
investors to trade in securities regardless of their
geographic location. In addition, the service will
help increase the number of investors at the
ASE and enhance their aptitude to engage in
securities trading.
FUTURE OUTLOOK