FTSEurofirst Index Series A Growing Success - 13 Linked Investment Products Launched In The Six Months To June 2005 - FTSEurofirst Indices Now Adopted By Nine Financial Institutions Around Europe

In the little more than two years since its inception in April 2003, the FTSEurofirst index series, in particular the FTSEurofirst 80 representing the euro zone, has won rapid acceptance on the French market and is a growing success in other parts of Europe as a tool for benchmarking, as well as for exchange-traded and OTC products, as was most recently illustrated in Portugal.

The true measure of the success of an index is the number of investment products linked to its performance, and on that count the FTSEurofirst 80 stands out — in the short space of six months from the beginning of 2005 no fewer than 13 new structured products based on the index came out on the market.

To date, leading financial institutions across Europe have launched a total of 26 structured products, two ETFs and three series of warrants based on the FTSEurofirst 80 as well as one ETF and one series of warrants based on the FTSEurofirst 100 (see appendix 1). Over the past 12 months alone, 28 new products were launched. Issuers include Société Générale, BNP Paribas, Lyxor Asset Management, Barclays Global Investors, La Poste, Crédit Agricole Group, Caisse d’Epargne Group, CM-CIC Asset Management and Banco de Investimento Global. More French and other European institutions are expected to adopt FTSEurofirst in the near future.

The Exane Derivatives Research team’s quarterly report on structured retail products in France notes that “trends confirm gains made by the FTSEurofirst 80 index”. Of the indices used as benchmarks for issues launched in the first half of 2005, the FTSEurofirst 80 ranked fourth with 10% of the market based on number of products and second in assets with 16%, behind the US market index S&P 500 (see appendix 2). In a single year, the FTSEurofirst 80 index has thus become one of the leading benchmarks on the French market.

Turning to derivatives, index futures and options were launched on Euronext.liffe in June 2003, and within ten months trading in the contracts had topped the million mark. February 2005 then saw the implementation of a new market-making scheme on FTSEurofirst index futures, and a trading and clearing-fee holiday was declared until the end of July 2005.

FTSEurofirst indices combine lower volatility and high liquidity with broader, more accurate market coverage to provide a superior index solution for trading in European equities.

In a joint statement, Jean-François Théodore, Chairman and CEO of Euronext, and Mark Makepeace, Chief Executive of FTSE Group, said “We are delighted that the FTSEurofirst index series is increasingly used throughout Europe for benchmarking, OTC and on-exchange products, which demonstrates its growing appeal and advantages over other indices. The FTSEurofirst 80 index is clearly the best choice to represent the euro zone and we are confident that it will be adopted by other financial institutions in coming months – which will also create favourable momentum for trading in index derivatives.”