The effort regarding the rationalization of the mechanisms of the management of the risk that arises from the registration of orders until the final and irrevocable settlement of transactions is incorporated in the frame of the policy of the HELLENIC STOCK EXCHANGES S.A. Group regarding the further modernization o the structures and operations of the capital market.

The environment that was formed by the HELLENIC STOCK EXCHANGES S.A. in the recent years · fully dematerialized securities listed on the Athens Stock Exchange, successful operation of the derivatives market, upgraded and integrated trading system, renewed statutory framework, as ell as a series of other projects, gives the capability to go side by side with other developed markets and establish infrastructures that they themselves are currently trying to develop.

With the establishment of the Central Counter Contracting Party we aim at securing:

• The smooth and unhindered operation of the market in periods of unwelcome developments, such as the inability of a member to satisfy, in part of in total, its obligations, with a simultaneous reduction of cost that this securing means through:
• The calculation of the risk that results from the execution of the transactions to their final and irrevocable settlement and the obtaining of the necessary guarantees from the counter contracting parties and
• The minimization of the systemic risk that may cause severe chain side effects to the market.

The benefits that may result from the application of the Central Counter Contracting Party and will be expressed as reduction of the cost of trading are:

• The release of capital from the Guarantee Fund, which currently covers both the relation member · investor and the risk of the counter contracting party.
• The reduction of the necessary guarantees by the members of the Athens Stock Exchange.
• The more efficient use of capital that have been blocked by the supplementary Fund.

The success of this venture aims at making our market more competitive as regards cost / security in relation to the other stock markets.

Simultaneously, the minimization of human intervention straight through processing will be pursued, so that the mistakes and the time required between the transaction and settlement are reduced.

The dematerialization at final investor level, the registration of the orders in the name of the final investor in the OASIS and the link of the trading (OASIS), clearing and settlement (DSS) systems, establish the conditions for the reduction of the time required for the clearing and settlement - currently three working days · which result in the reduction of risk and corresponding guarantees of its covering.

A work team has been established for the materialization of the Central Counter Contracting Party by the Athens Stock Exchange, the Athens Derivatives Exchange Clearing House and the Central Securities Depository and it will be engaged in the changes that must take place at operating, statutory and technical level.

The Managing Director of the Central Securities Depository, Mr. L. Zaggas, has been put in charge. The team will co operate with representatives of the Guarantee Fund, the Athens Stock Exchange Members Association, the Association of Greek Banks and the Investment Companies Association, as the changes extend beyond the HELLENIC STOCK EXCHANGES S.A. Group.

The product of the project will be the determination of the detailed specifications that will determine the amendments that must be materialized regarding the systems and procedures, as well as the specific changes in the statutory framework. A materialization action plan has been determined with the participation of all agencies.

The objective is the Central Counter Contracting Party to operate within the year 2002.