A WORD FROM THE CHIEF EXECUTIVE OFFICER 5 OUR GOVERNANCE 7 OUR CODE OF ETHICS 13 OUR KEY FIGURES AS OF 31/12/2009 15 OUR MAJOR FACTS IN 2009 17 THE ECONOMIC ENVIRONMENT IN 2009 27 THE STOCK MARKET IN 2009 31 OUR FINANCIAL STATEMENTS IN 2009 41 OUR FINANCIAL STATEMENTS IN 2009 ACCORDING TO THE INTERNATIONAL 47 FINANCIAL REPORTING STANDARDS (IFRS) THE GENERAL REPORT FROM THE EXTERNAL AUDITORS 54 THE REPORT OF THE EXTERNAL AUDITORS ACCORDING TO IFRS 55 RESOLUTIONS OF THE ORDINARY GENERAL MEETING 57 USEFUL CONTACTS 59 Contents Karim HAJJI Chief Executive Officer For the second year in a row, the Moroccan economy has shown resilience in a context marked by an international financial crisis and a slowdown in the world economic growth. This resilience reflects at the same time the relevance of the countercyclical policies implemented by our country and the solidity of its macro-economic fundamentals. In this context, the Casablanca Stock Exchange “CSE” resists better over the two last years than most emerging financial markets, with a MADEX®Float index which limits to 19% its cumulated losses over two fiscal years in spite of the absence of IPO’s since July 2008 and in spite of investors’ bearishness. The MASI®Float and MADEX®Float indexes thus closed year 2009 with slight drops, that is to say respectively -4.92% and -6.58%, compared to -13.48% and -13.41% in 2008. The market capitalization declined by only -4.30%, versus -9.31% in 2008, to stand at 508.9 billion Dirhams versus 531.8 in 2008. Our priorities consisted in restoring investors and issuers’ confidence and giving a new momentum to our teams around a unifying project. With a strong involvement from our administrators, an ambitious 2009 -2015 strategy has been worked out around 3 major development pillars to attract half a million investors, increase the listed firms to 150, and make Casablanca Stock Exchange a regional financial hub. The implementation of this strategy resulted initially in the strengthening of our teams at the level of the information systems, market operations and human resources, and endowed for the first time with a dedicated management. In a second phase, our efforts were focused on the security of our information systems through a better separation of the tasks between operations, networks management and maintenance, as well as the production of studies and projects. A project aiming at ensuring the high availability of our listing platform was also launched and should be brought to a close at the last quarter of 2010. Audits were carried out which led to the observation of various security issues and to the implementation of a “project management” approach in all our activities. With the aim of contributing to a new momentum of the financial activity, the Casablanca Stock Exchange organized under the high patronage of His Majesty King Mohammed VI and jointly with the APSB (*), a conference on financial markets under the topic “Together let us build tomorrow’s economy”. This event gathered more than 500 finance professionals and personalities from policy makers to public figures. It also allowed the market’s participants in sharing diverse visions and making new proposals and recommendations in order to unite their efforts around the market recovery. In responding to our investors’ needs and to improve the liquidity of our financial market, we have established a new Fifth listing phase for the securities listed on a continuous basis known as “Trading at Last”. This allows our investors to seize more market opportunities for an additional five minutes after the closing of the trading session of the day. In April 2nd, 2009, CSE has adopted a new model of governance shifting from a dual governorship represented by “the Board of Trustees and Supervisory Board” to a corporate one with “the Board of Directors and a General Manager”. The company’s shareholding structure was strengthened with the entry of a new securities firm, “Capital Trust Securities”, which began its operations in July 2009. Opening up to the regional and international financial environment was also at the top of our priorities. In this direction, we undertook several activities among them; collaborating with the nd A WORD FROM THE CHIEF EXECUTIVE OFFICER Arab stock exchanges by chairing the 32 annual meeting of the UBA (**), consolidating our relation with the “City of London”, and strengthening our relationship with other international financial markets. To recognize its leadership in contributing to the development of The African financial markets among other stock exchanges in Africa, CSE was awarded the “Second Prize of the Most Innovative Stock Exchange in Africa” by Africa Investor in the last conference event that was held in the New York Stock Exchange. Lastly, in order to ensure a better accessibility to the stock market’s information, CSE revamped its website by offering additional financial information about the listed companies. The website is available to investors and to the public in three languages; Arabic, French, and English since it was launched in January 2010. These various projects reinforce our position among other foreign markets specifically in Africa. It also contributes in meeting the demands of our ongoing developments with respect to our economy. Our people are our most important asset. We do not have material “property, plant and equipment” assets. Rather, we have talented, entrepreneurial professionals who are dedicated to the firm’s mission of supporting economic growth. In short, our people are central to who we are, to the cohesiveness of our culture, and to our ability to serve with integrity, reliability, and pride the needs of our clients and the market. These achievements would not have been possible without the commitment of our people. I, thus, take this opportunity to thank them all for playing a key role in our organization and for contributing with effectiveness in realizing our set objectives. I am confident that I can rely on their continued commitment to help us achieve all of our goals and surpass all the challenges which await us. (*) Association of Professionals of Brokerage Firms (**) Union of Arab Stock Exchanges Karim HAJJI Chief Executive Officer Year 2009 was characterized by a change in the mode of governance of the Casablanca Stock Exchange. The Supervisory Board and the Board of Trustees both put in place since 2000 have been replaced by a General Management and a Board of Directors. COMPOSITION AND OPERATION OF THE BOARD OF DIRECTORS The Casablanca Stock Exchange’s Board of Directors was established in April 2, 2009, to replace the Supervisory Board set up in 2000. It consists of 12 members and one government commissioner who is appointed by the Ministry of Finance & Privatization. The commissioner is invited to all the meetings held by the Board or the Committees’ one deriving from it. The Board of Directors elects one President and sets the duration of his or her function which may not exceed their mandated period as a member. The members of the Board exercise their functions for a period of 3 years, renewable. One Secretary is appointed based on a proposal from the President. He or she takes care Annual Report 2009 • Casablanca Stock Exchange 7 of the organization of the meetings as well as the drafting and the filing of the Board’s or OUR GOVERNANCE Committees’ minutes of the meetings under the conditions prescribed by the law. INDICATORS OF GOOD GOVERNANCE The Board of Directors conducted the renewal of the 3 technical committees 1. The Audit Committee 2. The Strategy and Development Committee 3. The Nominations and Compensations Committee. It also adopted the quantified indicators of good governance in order to measure the evolution of such indicators over a 3-year period. These indicators illustrate the number of meetings held by the Board and the technical Committees as well as the average rate of participation of their respective members in the meetings. Indicators (*) 2007 2008 2009 Board of Directors Number of meetings 7 9 10 Average rate of participation 64% 76% 81% Audit Committee Number of meetings 3 7 5 Average rate of participation 78% 76% 100% Nominations and Compensations Committee Number of meetings 4 3 5 Average rate of participation 69% 75% 70% Strategy and Development Committee Number of meetings 2 2 3 Average rate of participation 69% 75% 70% (*) The table is based on the meetings which were the subject of Minutes filed in the Minutes registry of the Board of Directors and that of the technical committees held during this period. The increase in the number of meetings of the Board and of the technical committees shows the continuous involvement of the members in the governance of the company. The same goes for the average rate of participation of the members which increased considerably except for those of the Nominations and Remunerations. However, the Strategy and the Development Committees’ meetings experienced a slight drop in comparison with FY 2008. SHAREHOLDERS As of June 30th, 2010, the Casablanca Stock Exchange capital is standing at 19.020.800 MAD. It is equally held by the 17 securities firms which operate on the Moroccan stock market. BOARD OF DIRECTORS As of June 30th, 2010 The Board of Directors consists of the following 12 members: Annual Report 2009 • Casablanca Stock Exchange 9 O U R G O V E R N A N C E I.C.F Al Wassit, represented by Mr. Aomar YIDAR (President) Attijari intermédiation, represented by Mr. Jalal BERRADY BMCE Capital Bourse, represented by Mr. Youssef BENKIRANE CFG Marchés, represented by Mr. Younès BENJELLOUN Eurobourse, represented by Mr. Omar AMINE BMCI Bourse, represented by Mr. Mohamed AMRANI Crédit du Maroc Capital, represented by Mr.