&KLQDVVWRFNPDUNHWFUDVKH[SODLQHG

FXUUHQWDIIDLUVHFRQRP\

$XJXVW

7KHZRUOGZDVLQXWWHUVKRFNZKHQVWRFNSULFHVDFURVVWKHJOREHFUDVKHGLQDQXQSUHFHGHQWHGPDQQHURQ0RQGD\$XJXVWLQ
UHVSRQVHWRWKHVWHHSFUDVKLQ&KLQHVHVWRFNSULFHV,Q&KLQDWKHPDLQVWRFNLQGH[WKH6KDQJKDL&RPSRVLWH,QGH[KDVIDOOHQE\DOPRVW
RQ0RQGD\7KH&KLQHVHVWRFNPDUNHWLVLQFUDVKPRGHVLQFH-XQHWKLV\HDUUHYHUVLQJWKHSUHYLRXVRQH\HDU
VVKDUSULVH
)URP-DSDQWR86VWRFNSULFHVLQQRQ&KLQHVHPDUNHWVIHOOEHWZHHQWRRQDQDYHUDJHSURGXFLQJRQHPRUHEODFN0RQGD\LQ
VWRFNPDUNHWV
(DUO\WUHQGVIRU7XHVGD\WK$XJXVWLQGLFDWHVWKDWVKDUHSULFHVFRQWLQXHVWRQRVHGRZQERWKLQ-DSDQDQG&KLQDZKHUHWUDGHEHJLQV
HDUO\
0DQ\HFRQRPLVWVDQGH[SHUWVDUHSUHGLFWLQJWKDWWKH&KLQHVHVWRFNFUDVKZLOOGHHSHQWKHSUHVHQWUHFHVVLRQDQGWKHZRUOGHFRQRP\LV
HQWHULQJLQWRDQRWKHUFULVLVSKDVHVLQFH6RPHH[SHUWVKDYHFRPSDUHGWKH&KLQHVHVWRFNEXUVWWRWKH86VWRFNFUDVKLQ
ZKLFKXOWLPDWHO\EURXJKWWKH*UHDW'HSUHVVLRQ
1RZZKDWLVWKHUHDOSUREOHPLQ&KLQD"
:KDWLV&KLQDVVWRFNPDUNHWFUDVK"
7RXQGHUVWDQG&KLQDVSUHVHQWVWRFNPDUNHWSUREOHPZHKDYHWRNQRZWKDWWKH&KLQHVHVWRFNSULFHVKDYHSHDNHGRUZDVYHU\KLJK
GXULQJ-XQH)RUWKH6KDQJKDL&RPSRVLWH,QGH[WKLVLVWKHSHDNUHFRUGHGDIWHUWKHFULVLVRI
7KH6KDQJKDL&RPSRVLWH,QGH[6&,UHFRUGHGWKHVHYHQ\HDUKLJKHVWSRLQWRIRQ-XQHEXWVFRRSHGGRZQWRRQ
$XJXVWWK6KDUHSULFHVZHUHIDOOLQJGXULQJWKHODVWWZRPRQWKVGHVSLWHVHYHUDOPHDVXUHVE\WKH&KLQHVHDXWKRULWLHV
6LQFH-XQHWKH&KLQHVHVWRFNVDUHXQGHUJRLQJDIUHHIDOO)ROORZLQJIDFWVZLOOUHYHDOWKHH[WHQWRIWKHPDUNHWFUDVK
7KHELJJHVWPRQWKO\ORVVLQVL[\HDUVZDVUHFRUGHGGXULQJ-XO\
7KHELJJHVWGDLO\ORVVLQQLQH\HDUVZDVUHFRUGHGRQWKRI$XJXVWQHDUO\
,QWZRWUDGLQJGD\VVWWKRI$XJXVWWKH&KLQHVHVKDUHSULFHVZHUHIDOOHQE\
,IZHDGGWKHWUDGLQJWUHQGRI7XHVGD\WKH6&,KDVFUDVKHGE\LQWKHODVWWKUHHWUDGLQJGD\V
8QGHUVWDQGLQJWKHEXEEOHDQGEXUVWLQWKH&KLQHVHPDUNHW
<RXUOHDUQLQJDERXWVWRFNPDUNHWVKRXOGVWDUWIURPDQLPSRUWDQWOHVVRQ7KHOHVVRQLVWKDWHYHU\EXEEOHZLOOHQGLQDEXUVW,QWKHVWRFN
PDUNHW EXEEOH LV VKDSUW ULVH LQ SULFHV RI VKDUHV %XUVW PHDQV GHHS IDOO LQ SULFHV RU D FUDVK ,I VKDUH SULFHV KDYH UHJLVWHUHG D VKDUS
LQFUHDVHRUEXEEOHWKHKLJKSUREDELOLW\IRUWKHFRPLQJSHULRGLVIRUDVWHHSIDOODQGQRWIXUWKHUULVH6LPSO\SXWIRUHYHU\EXEEOHWKHUH
ZLOOEHDEXUVW
)RU&KLQDWKHVWRFNPDUNHWZDVIRUPLQJDEXEEOHEHWZHHQ-XQHDQG-XQH,QWKLVRQH\HDUSHULRGWKHVWRFNSULFHV
LQFUHDVHGE\7KH6&,ZDVMXVWLQ-XQHDQGLWVN\URFNHWHGWRLQ-XQH
)ROORZLQJWUHQGVLQGLFDWHWKHEXEEOHDQGEXUVWHSLVRGHLQ6&,

7LPH6KDQJKDL&RPSRVLWH,QGH[SRLQWV
-XQHSRLQWV
'HF
-XQH
$SULO
6RFOHDUO\WKHUHZDVDEXEEOHIRUPDWLRQDQGDEXUVWZDVLQWKHPDNLQJ
:KDWFRQWULEXWHGWRWKHEXEEOHLQ&KLQDVVWRFNPDUNHW"
7KH.H\SRLQWWRVROYHWKLVSUREOHPLVWKDW&KLQDVVWRFNSULFHVKDYHLQFUHDVHGE\LQRQH\HDUEHWZHHQ-XQHDQG-XQH
7KLVLQFUHDVHLVDQXQSUHFHGHQWHGRQHJLYHQWKHVORZJURZWKLQWKHHFRQRP\%HVLGHVWKHZRUOGHFRQRP\LVLQUHFHVVLRQ
7KHPDLQUHDVRQIRUWKHVKDUHSULFHZDVWKHSROLF\RIWKHJRYHUQPHQWWRHQFRXUDJHSDUWLFLSDWLRQRIJHQHUDOSXEOLFLQVWRFNPDUNHW
%DQNLQJV\VWHPZDVHQFRXUDJHGWRDOORZSHRSOHWRERUURZPRQH\DQGSXUFKDVHVKDUHV
,Q WKH RQH \HDU SHULRG EHWZHHQ -XQH  DQG -XQH  QHDUO\  PLOOLRQ QHZ DFFRXQWV ZHUH PDGH 0RVW RI WKH QHZ VKDUH
SXUFKDVHUV ZHUH PDGH E\ RUGLQDU\ SHRSOH ,WV UHSRUWHG WKDW WKH KLJKHVW PRQWKO\ DFFRXQW RSHQLQJ RI  ZDV LQ 2FWREHU 
1HDUO\WHQPLOOLRQQHZVKDUHEX\HUVMRLQLQJWKHWUDGLQJLVDSKHQRPHQDOHYHQW
$QRWKHUIDFWRUWKDWERRVWHGVWRFNPDUNHWWUDGLQJYROXPHZDVSURPRWLRQRIPDUJLQWUDGLQJE\SXEOLF0DUJLQWUDGLQJDOORZVSHRSOHWR
WUDGHKXJHYROXPHRIVKDUHVZLWKVPDOODPRXQWRIPRQH\LQWKLHUDFFRXQW
:K\VWRFNSULFHVKDYHIDOOHQ"
7KHEDVLFUHDVRQIRUWKHFRQWLQXRXVIDOOLQVWRFNSULFHVLVWKHGHFOLQLQJJURZWKWUHQGLQWKH&KLQHVHHFRQRP\6ORZLQJHFRQRPLFJURZWK
DQGH[SRUWVIDOODQGGHFOLQLQJLQYHVWPHQWVSHQGLQJDQGSURILWVFHQDULRRIFRPSDQLHVDOOZHUHQHJDWLYHQHZV
6ORZLQJJURZWKUDWHLVDQHJDWLYHQHZVDQGLQ&KLQDVXFKDQHJDWLYHQHZVFDPHDWDWLPHZKHQWKHPDUNHWLVDOUHDG\DWDQXQEHDUDEOH
KLJKOHYHORUZKDWZHFDQVD\DWWKHSHDNRIWKHEXEEOH
6ORZLQJJURZWKPHDQVOHVVSURVSHFWVIRUFRPSDQLHVLQIXWXUH,QWKLVVFHQDULRWKHSXEOLFZKRLQYHVWHGLQHTXLWLHVIRXQGWKHSUHVHQW
VWRFNSULFHVYHU\KLJKWULJJHULQJPRWLYDWLRQWRVHOOVKDUHV%HVLGHVSROLF\PDNHUVLQDELOLW\WRUHVFXHWKHPDUNHWKDVVKRFNHGWKH
LQYHVWRUVZKRODWHUVROGVKDUHVWRVDYHWKHLUPRQH\
+HQFHSHRSOHUHVSRQGHGE\DJJUHVVLYHVHOOLQJRIVKDUHV/DWHUGXULQJ-XO\DQG$XJXVWSHRSOHPDGHSDQLFVHOOLQJIHDULQJORVVHV,WLV
WREHQRWHGWKDWRUGLQDU\SXEOLFVHOOVTXLFNO\EXWLQVWLWXWLRQDOLQYHVWRUZLOOQRWVHOOWKDWTXLFNO\7KHUHZDVKLJKSDUWLFLSDWLRQRILQGLYLGXDO
LQYHVWRUVLQ&KLQHVHHTXLW\PDUNHWV
,QFRQFOXVLRQLWFDQEHVDLGWKDWWKHSUHVHQWFULVLVLQ&KLQHVHVWRFNPDUNHWLVDVWHHSFRUUHFWLRQ$OUHDG\VWRFNSULFHVZHUHLQFUHDVHG
E\GXHWREX\LQJSUHVVXUHV7KDWPD\EHFRUUHFWHGWKURXJKSULFHIDOO7KHSULFHIDOORIFRXUVHLVWULJJHUHGE\VORZLQJHFRQRP\
QHZV
:KDWZLOOEHWKHLPSDFWRI&KLQHVHVWRFNPDUNHWFUDVKRQ,QGLD"
7KHLPDFWRIWKH&KLQHVHVWRFNFUDVKLVJRLQJWREHVOLJKWO\PL[HGLQ,QGLD7KLVLVEHFDXVHWKRXJK,QGLDLVLQFUHDVLQJO\GHSHQGHGXSRQ
IRULHJQLQYHVWPHQWLQVWRFNPDUNHWWKHHFRQRP\LVVWDEOHUDPRQJWKH(0(V%HVLGHVWUDGLWLRQDOO\,QGLDLVVORZLQTXLFNUHIRUPVDQGWKLV

KDVUHVFXHG,QGLDLQDOOSUHYLRXVJOREDOFULVLVWKH0H[LFDQFULVLVWKH(DVW$VLDQFULVLVDQGWKHJOREDOILQDQFLDOFULVLVRI
7KLV WLPH DOVR ZHDN SROLFLHV LQ &KLQD PD\ SXW D YRWH RI FRQILGHQFH RQ ,QGLD 7KLV GRHVQ
W PHDQ WKDW IOXFXWDWLRQ LQ JOREDO PDUNHWV LV
JRLQJWREHXQDIIHFWHG6WRFNSULFHVDQGYDOXHRIUXSHHDOOZLOOEHLQIOXHQFHGE\&KLQHVHHYHQWVEXWLQDPRGHUDWHPDQQHU
,QGLDLVVWDEOHUDPRQJWKH(0(V
,QGLD DW SUHVHQW LV WKH PRVW VWDEOH DPRQJ WKH (0(V DQG WKH IDVWHVW JURZLQJ LQ WKH UHFHVVLRQ KLW JOREDO HFRQRP\ )DOO LQ FRPPRGLW\
SULFHVZLOOKHOSXVPRUHUDWKHUWKDQKLWWLQJXV+HQFHWKRXJKWKHDGYHUVHHIIHFWIURP&KLQD
VHFRQRPLFSUREOHPZLOOEHXQLYHVUDOLWZLOO
EHOHVVVHYHUHRQ,QGLD
7KHDGYHUVHHIIHFWVDQGWKLHUSUREDELOLOWLHV
7KHUHZLOOEHWZRHIIHFWVRIWKH&KLQHVHURXWRQ,QGLD
VHFRQRP\)LUVWLVWKHVWRFNPDUNHWSDQLFIDOOLQVWRFNSULFHVDQGGHSUHFLDWLRQRI
UXSHH1HDUO\SHUFHQWRIDFWLYHWUDGHUVLQ,QGLD
VVWRFNPDUNHWDUH)RULHJQ3RUWIROLR,QYHVWRUV)3,1RZWKHVHJURXSPD\FRQWLQXHWR
VHOOVKDUHVLQLPPHGLDWHIXWXUHRWIURPSDQLFLQWKHJOREDOPDUNHWV(DFKWLPHWKHJOREDOPDUNHWFRPHVXQGHUWXUPRLOLWZLOOEULQJVLPLDU
HIIHFWVLQ,QGLDDVZHOO
'HSUHFLDWLRQSUHVVXUHRQ5XSHH
6LPLODUO\ERWK,QGLDDQG&KLQDDUHWDJHGDV(PHUJLQJ0DUNHW(FRQRPLHV/DFNRIWUXVWLQ&KLQHVHHFRQRPLFPDQDJHPHQWPD\FUHDWH
FRUUHVRSRQGLQJHIIHFWLQ,QGLDDVZHOOEXWLQWKHVKRUWUXQRQO\$FDSLWDOIOLJKWRUZKDWZHRIWHQVD\FRQWDJLRQHIIHFWPD\VHWLQDWOHDVW
LQWKHVKRUWUXQ7KLVZLOOSURGFXHFDSLWDORXWIORZIURP,QGLD
VVWRFNPDUNHWDQGWKHHFRQRP\7KHRXWFRPHRIVXFKDFDSLWDORXWIORZZLOO
EHGHSUHFLDWLRQRIUXSHH7KHH[WHQWRIVWRFNIDOODQGUXSHHGHSUHFLDWLRQGHSHQGVXSRQKRZTXLFNO\WKH&KLQHVHVWRFNIDOOLVDUUHVWHG
*'3JURZWKDQGHFRQRPLFSHUIRUPDQFH
6HFRQGO\ *'3 JURZWK ZLOO GHFOLQH LQ WKH ORQJ UXQ DV D UHVXOW RI FDSLWDO RXWIORZ DQG XQFHUWDLQW\ LQ JOREDO PDUNHWV 6KDUS GHFOLQH LQ
H[SRUWVLQYHVWPHQWHWFDUHVRPHDGYHUVHHIIHFWVRIWKH&KLQHVHURXW
6HHPRUHDWKWWSZZZLQGLDQHFRQRP\QHWVSOFODVVURRPFKLQDVVWRFNPDUNHWFUDVKH[SODLQHGVWKDVK$4VU8GSXI