Investor Relations Department

So Paulo, SP

November/2015

Public1

Forward Looking Statements

This presentation may contain certain statements that express the managements expectations, beliefs and
assumptions about future events or results. Such statements are not historical fact, being based on currently
available competitive, financial and economic data, and on current projections about the industries BM&FBOVESPA
works in.
The verbs anticipate, believe, estimate, expect, forecast, plan, predict, project, target and other
similar verbs are intended to identify these forward-looking statements, which involve risks and uncertainties that
could cause actual results to differ materially from those projected in this presentation and do not guarantee any
future BM&FBOVESPA performance.
The factors that might affect performance include, but are not limited to: (i) market acceptance of BM&FBOVESPA
services; (ii) volatility related to (a) the Brazilian economy and securities markets and (b) the highly-competitive
industries BM&FBOVESPA operates in; (iii) changes in (a) domestic and foreign legislation and taxation and (b)
government policies related to the financial and securities markets; (iv) increasing competition from new entrants
to the Brazilian markets; (v) ability to keep up with rapid changes in technological environment, including the
implementation of enhanced functionality demanded by BM&FBOVESPA customers; (vi) ability to maintain an
ongoing process for introducing competitive new products and services, while maintaining the competitiveness of
existing ones; (vii) ability to attract new customers in domestic and foreign jurisdictions; (viii) ability to expand the
offer of BM&FBOVESPA products in foreign jurisdictions.
All forward-looking statements in this presentation are based on information and data available as of the date they
were made, and BM&FBOVESPA undertakes no obligation to update them in light of new information or future
development.
This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall
there be any sale of securities where such offer or sale would be unlawful prior to registration or qualification
under the securities law. No offering shall be made except by means of a prospectus meeting the requirements of
the Brazilian Securities Commission CVM Instruction 400 of 2003, as amended.
2

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency
BRAZILIAN MARKET OPPORTUNITIES
Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
3

Exchange sector
Safety and market integrity as priorities
Capital and derivatives markets in Brazil

Exchange market characteristics in Brazil

Stable and solid regulation

BVMF is the sole exchange, despite the

market being open for competitor since 2007

CVM Trade and post-trade

BACEN Post-trade , banks and
intermediaries

Stocks exclusively traded through an exchange

(Dark pools, MTFs and internalization prohibit)

Main participants

Identification of the final beneficial owner in

the entire trading and post-trading chain

Intermediaries local and international

brokers (linked to bank and independent)

Derivatives are predominantly listed and OTC

derivatives must be registered mandatorily

Listed companies
Investors institutional, foreign and
individual (retail)

Securities lending mandatorily through a

central counter-party (CCP)
The exchange is responsible for oversight and
self-regulation of the markets in which it
operates

Why invest in BM&FBOVESPA?

A global exchange
1890:
Foundation of Bolsa
Livre (Bovespa's
predecessor)

1967:
Bovespas
Mutualization

1986:
Start of
BM&F
activities

Aug 2007:
Bovespa Hld
demutualization

Oct 2007:
Bovespa Hld
IPO (BOVH3)

Sep 2007: BM&F

demutualization

Nov 2007:
BM&F IPO
(BMEF3)

May 2008:
Merger between BM&F and Bovespa
Hld and creation of BM&FBOVESPA
(BVMF3)

and R$5,9 billion on distributed earnings since 2008

State-of-the-art trading and post-trading

systems: ~R$1.6 billion invested in resilience,

Revenue diversification: trading and post-

Solid market position: dominant position in the

trading services for stocks, derivatives, fixed income

and OTC

domestic market and significant presence in the

global exchanges industry

Constantly seeking operational efficiency:

Reference in corporate governance

standards: cutting edge in adopting best practices

High dividend payer: +80% of the net income

investments in technology and cost growth below

inflation

strength and safety

to the market

Practice of the period and amount distributed from Jan/2008 to Jun/2015;

Expenses adjusted to Companys depreciation, stock granting plan principal and social charges -, stock options plan, tax on dividends from the CME Group, transfer of fines and provisions

Multi-asset and vertically integrated model

Value gained across most of the chain
Services for the whole chain
Trading Platform: equities, derivatives, government and
corporate bonds, funds, spot FX, among others

EQUITY

Post-trading Platform:
Central counterparty (CCP)

CASH

INTEREST

Settlement System (SSS)

FX

OPTIONS

FUTURE

POST-TRADE

Central Depository (CSD)

Services for Issuers and Participants:

Listing

CCP, SSS and CSD

Trading access (brokers)

SWAP

COMMODITIES

Securities lending

FORWARD

CREDIT

Custody for clubs and foreign investors (2689)

Market Data (vendors)
Indices Licensing
Software Licensing
OTC (derivatives and fixed income)

Multi-asset and vertically integrated model

Value gained across most of the chain
BRAZIL

USA

(Internalization of orders is forbidden)

(Internalization of orders is allowed)

Trading venues

TRADING
DTCC

Brokers A and B

Brokers A and B
Broker
A

Broker
B

POST-TRADING
CCP
SSS
CSD

Investors

Investors
Investors

Model 100% vertical: clearing,

settlement and central depository at
the FINAL BENEFICIAL OWNER LEVEL

Investors

Clearing, settlement and depository

occur at the brokerage houses

Corporate governance
Reference in corporate governance practices
Solid Governance Practices

Broadly Dispersed Shareholder Base

Listed in Novo Mercado (voting shares only and

other shareholders rights, transparency, etc.)

7% 7%
6%
5%
5%

Majority of the Board composed of independent

members (regulatory requirement)

2%

Chairman is an independent member

67%

Other Board members are linked to market

participants or strategic partner (CME);
although considered non-independent, are not
connected to controlling group or management

Oppenheimer Funds

All Board members are not Companys executive

Well-defined and solid Board of Directors and
Boards Committees
Executive compensation system aligned with
Companys performance and strategic
objectives, as well as with shareholders longterm interests

(update in Out. 2015)

Vontobel Asset Management (update in Feb. 2013)

Capital World Investors (update in Oct. 2015)
BlackRock Funds (update in Aug. 2015)
Capital Group International, Inc (update in Oct. 2015)
Treasury stock
Others

(update in Oct. 2015)

(update in Oct. 2015)

Note: percentage ownership are estimated but may not represent exact figures
due to different information dates about largest shareholders positions

Corporate Governance
Multidisciplinary knowledge in conducting business
2013-15 Board of Directors Composition
Age

Years
in the
Board

Pedro Pullen Parente

Former Minister of State; Former CEO of Media and
Commodity Conglomerates

62

Claudio Luiz da Silva Haddad

Former CEO of Investment Bank; Founder and CEO of
Business School

67

Board Member

Highly qualified Board Members and well-functioning

Boards Committees
Commitment and independence of Board of Directors
and Committees members
Corporate Governance Profile - Board & Committee Summary
Committees

Antnio Quintela
Former CEO of CS Brasil and Americas; Portfolio Manager

49

Luiz Antnio de Sampaio Campos

Former Director of CVM; Lawyer

44

Luiz Fernando Figueiredo

Former Governor of the Central Bank; Portfolio Manager

51

Luiz Nelson Guedes De Carvalho

Former Central Bank and Sec. Commission Officer; Member
of IIRC and CPC/IASB; Professor of Accounting

69

Andr Esteves
CEO of BTG Pactual

Board
Audit

Nomination
and CG

Comp.

Risk

Brokerage
Industry

11

Independent Board

Market participant + Board

47

Independent Non-Board

Denise Pauli Pavarina

Bradesco executive; Chairwoman of Anbima

51

Market participant Non-Board

Eduardo Mazzilli de Vassimon

Director of Ita e CRO of Ita Holding

57

13

13

10

Jos Berenguer Neto

CEO of JP Morgan Brazil

48

90%

85%

100%

100%

83%

93%

Charles P. Carey
Former Chairman of CBOT; CME Group Board Member

59

Independent
members

# Members

# of meetings (2014)
Average attendance (2014)

Linked to
market participant or
strategic partner (CME)

Note: in the case of the Advisory Committee for the Securities Intermediation Industry the statistics
regarding number of meetings and attendance considered the previous composition with 6 members,
including two Board members. This change was implemented in Feb 2015.

Corporate Governance
Multidisciplinary knowledge in conducting business
Management and Internal Governance

HR, Marketing
and Education
Sustainability
and Press

Board of
Directors

Internal Audit

CEO
Edemir Pinto

Corporate
Risk

CFO
Daniel Sonder

COO
Ccero Vieira

CIO
Luis Furtado

CPO
Eduardo Guardia

Financial, Legal,
IR and Issuer
Regulation

Trading, Risk
Management,
Clearing,
Settlement,
Depository,
BVMF Bank and
Market
Participants
Relationship

Trading, Posttrading, PMO,

New Products,
Infrastructure,
Mid- Back-Office
Systems

Products and
Business
Development,
Comercial
Relations (issuers
and investors)
and International
Offices

4 MDs

6 MDs

6 MDs

5 MDs

Internal Working Groups

Advisory Committees

Market Advisory
Chambers

Management (5 Executives + 25MDs)

Responsible for implementing the guidelines
established by the Board or Directors, executing the
strategic plan, monitoring and executing the Companys
operations

Internal Working Groups (budget, products and

services, projects, others)
This internal working groups are important components
of the Companys corporate governance, monitoring
the budget process and establishing priorities for
products, services and projects development, among
other things
Advisory Committees (market and credit risks,
corporate risk, sustainability, code of conduct, business
continuity, others)
Multidisciplinary internal groups that address and
monitor important business and issues of the Company
Advisory Chambers (commodities, listing, equities,
fixed income, FX, derivatives, others)
Several open channels with investors, market
participants and companies which collaborate to
develop and improve products and services, as well as
to suggest better practices

The Head of the Audit Department reports functionally to the Board of Directors and the Audit Committee. The Audit Committee may periodically assess the performance of the Head of Audit
Department, after consulting the Executive Board.

10

BM&FBOVESPAs Sustainability Policy

Sustainability as a long-term driver

11

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers
MAIN GROWTH INITIATIVES
Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
12

Opportunities in the Brazilian market

BM&FBOVESPA is ready to capture future growth

Growth opportunities in the Brazilian

equities and derivatives markets
EQUITIES MARKET
Portfolio diversification: diversification of institutional investors portfolios
with a higher participation of equities
Retail investors: small number of retail investors and growth of the middle
class

Listed companies: low number of listed companies, while important sectors

are not adequately represented on the exchange

DERIVATIVES MARKET
Growth of credit and fixed-rate government debt: higher demand for
hedging from financial institutions and institutional investors
Growth of foreign trade: higher demand for hedging through FX contracts
Equities market development: growth in demand for index-based contracts
OTC derivatives: capital requirements (Basel) should benefit OTC
transactions through a CCP

13

Investors exposure to equities is low

Investors portfolio opportunities shifting to equities
Investors portfolios are highly
concentrated in fixed income

Investment Funds AUM (in BRL billions)

Funds AUM evolution. Global average of 40% for equities

Historically high interest rates

Low level of sophistication of pension funds and
some asset managers
Lack of knowledge about the equity market,
combined with retail investors fixed-income
mindset

Number of Custody Accounts (in thousands)

Number of retail investors represents only 0.3% of the
population (lower than global average)

Sources: BM&FBOVESPA, ANBIMA and ABRAPP. Aug/15 and May/15.

Pension Funds AUM (in BRL billions)

Participation of equities in the portfolio of pension funds

14

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform
MAIN GROWTH INITIATIVES
Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
15

BM&FBOVESPA IT, Risk and Operating Development

Building a state-of-the-art platform to boost market growth
High performance: high availability, submilliseconds latency, low standard deviation

BM&FBOVESPA is investing
more than R$ 1.6 billion (2010 2016) to build state-of-the-art
IT, Risk and Operating
infrastructure

Operational leverage: easily scalable capacity

Capital efficiency for clients

Capital efficiency for clients: integrated

risk calculation (equities and derivatives OTC and listed); and unification of
settlement windows

Attract and retain clients and

strengthen relationship with
intermediaries

Rationalization and standardization of

rules, procedures and requirements
Capital efficiency for clients: integrated
risk calculation (OTC and Exchange Traded
Derivatives)

Development of markets and

products
OTC MARKET

Operational leverage for

BM&FBOVESPA
Innovate and enhance market
robustness ahead of regulatory
demands
The implementation of IPN/CORE depends the approval of the regulators.

NEW
DATA CENTER

Customer relationship: strengthening

relationships and adding revenue with
little marginal expenses
Long-term IT sustainability: significant
capacity to expand co-location and own
systems
Customer relationship: able to host
participants and clients infrastructure
16

PUMA Trading System - Performance

Enabling the increase of trades

Successive records broken in recent years, without delays or

availability failure
Development of the number of messages/days (in millions)

Source: BM&FBOVESPA.

17

Clearinghouses Integration and New Risk Model (CORE)

Post-trade environment evolution
Organization of the post-trade
environment by types of assets/products

Organization of the post-trade

environment by process
Equities, ETFs,
BDRs

4 rulebooks and
4 manuals.
Other products
and assets

4 participant
structures

4 distinct
environments /
IT architectures
4 settlement
windows and 4
multilateral
balances

4 systems /
back-office
processes

Government
Bonds
Rules and Manuals

Structure of market participants

Participants and customer registration
OTC
derivatives

Allocation and transfer

Corporate
fixed income

Position control
Clearing and settlement

4 systems /
processes for risk
management

4 registration
systems for
participants and
clients.
4 pools of
collateral

Risk management
Pool of collateral
Securities
lending

Interbank spot
foreign
exchange
Futures, options,
forwards

Exchange and market

participation cost
reduction

Liquidity management
improvement

More efficient
allocation of capital by
investors

Operational and
technological risk
reduction
18

Clearinghouses Integration and New Risk Model (CORE)

Post-trade environment evolution

What we did

The achievements

Aug14: derivatives phase of the new

BM&FBOVESPA Clearinghouse and of
the new risk model CORE

4Q15: conclusion of substantially all

the IT development of the equities
phase
Roughly R$20 billon released in
collateral

What were the challenges

400 employees involved

46 legacy systems were deprecated

and 31 new other were installed
+65 market participants (the
majority adopts SINACOR)

R$15 billion reduction in required

collateral
R$5 billion increase to the value of
deposited collateral
R$12 billion withdrawn in the early
days of activity

Almost 6 months since the launching

Calculate and process +1.3bn
instrument prices
We have built a dedicated
simulation environment, meeting
demands from market participants

The development will be followed

by the certification and parallel
production processes
Launching will depend on tests
results and regulatory approval

What are the challenges

Integration with the CSD

11 parallel production cycles

CORE - complexity and sophistication

What is next

Very high availability

Serving participants and clients with
high quality services
Delivering efficiency

Settlement of securities
(restrictions, failures, integration
with securities lending system)
Covered options and forward
transactions
Corporate actions treatment
Settlement window unification

Risk more risk factors, higher

volume of calculations

19

Integration of the Clearinghouses Derivatives (Performance)

Gains in efficiency, resilience and capacity expansion

Development of trade numbers and records (in thousands)

In one year...

Development of risk simulator use (in thousands)

10 trading records broken

+72MM risk calculations
+1.8MM risk simulations
+61MM trades captured
+126MM allocations

99.9% availability

Source: BM&FBOVESPA.

20

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer
OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
21

Products and Services Development

Focus on the customers demands and needs

Long-term development of products, markets and services

Greater liquidity for listed products
Development of infrastructure for expansion of MM and HFT activity
Capital efficiency generated by CORE enables/encourages the realization of new strategies
Development of the securities lending platform
Marketing listed products and attracting new customers
Expanding the retail investor base

Incentive program with market participants

Expanding the portfolio to attend to the investment profile of individuals (Tesouro Direto, ETFs,
FIIs ...)
Discussion about tax treatment simplification in the equities market

Capture of institutional investors diversification into foreign securities

Listing of foreign securities (non-sponsored BDRs and Foreign Index ETF)
Cross-listing of futures contracts

22

Products and Services Development

Focus on the customers demands and needs

Long-term development of products, markets and services

Greater number of listed companies
Discussions with the Government to encourage and facilitate IPOs by SMEs

Law 13.043 grants exemption on capital gains for eligible SMEs investors until 2023
Creation of investment fund with proper structure to invest in SMEs
Reduction of maintenance and public offer cost for listed companies
Include stocks in the roll of restricted public distribution efforts
BNDES support to foster IPOs on BOVESPA MAIS

Fixed Income and OTC markets (product, market and revenue diversification)

Securities registration: (i) marketing of already-available products (CDB, LCA, LCI and COE); ii)
new products (CDB - new types, Financial Bills, COE - physical delivery and repos)
OTC Derivatives: (i) benefits of CORE; (ii) SWAPs and Flexible Options migration to the new
platform (flexibility and operational efficiency); and (iii) development of SWAPs with cash flow
Corporate bonds: (i) acceptance of securities with restricted distribution efforts (ICVM 476);
and (ii) migration of trading to PUMA
Constant fee structure and incentive improvements
Use of pricing policies and incentives as important tools for the development of products,
markets and services, as well as alignment with market participants

Review and monitoring of existing pricing and incentives policies

23

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange
FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
24

Bovespa Segment
Operational highlights
AVERAGE DAILY TRADING VALUE ADTV (BRL billion)

AVERAGE ANNUAL MARKET CAP (BRL trillion)

1.98 2.03

2.33 2.37 2.41 2.41 2.39 2.25

64.2%70.0%
66.6%
63.2%
63.8%
56.4%

1.83

1.31
0.72

TURNOVER VELOCITY (12 months average)

0.94

30.8%

37.6%

73.4% 72.8%

38.7% 42.3%

29.4%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Updated to Oct 31, 2015. Ratio of cash market trading volume to the market cap of the exchange.

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

25

BM&F Segment
Operational highlights
AVERAGE DAILY TRADED VOLUME ADV (thousands of contracts)

REVENUE PER CONTRACT - RPC (BRL)

J-15

F-15

M-15

A-15

M-15

J-15

J-15

A-15

S-15

O-15

Interest rates in BRL

0.950 1.141 0.979 0.889 0.918 1.004 1.046 1.120

2007

1.112 1.226 1.192

1.165

1.222

1.172

1.018

1.132

1.032

1.010

1.207

1.136

1.212

FX rates

1.859 2.065 2.161 1.928 1.894 2.205 2.535 2.669

3.467 2.980 3.173

3.007

3.048

3.158

3.569

3.442

3.705

3.554

3.686

3.932

4.436

Stock Indices

1.501 2.145 1.620 1.564 1.614 1.524 1.761 1.774

2.125 1.628 2.119

1.842

2.422

1.994

2.302

1.920

2.420

1.823

2.209

1.833

2.213

Interest rates in USD

0.965 1.283 1.357 1.142 0.941 1.015 1.231 1.294

1.790 1.078 1.461

1.557

1.645

1.797

1.911

1.747

1.770

1.633

1.768

2.154

2.268

Commodities

3.195 3.587 2.307 2.168 2.029 2.239 2.534 2.390

2.433 2.510 2.631

2.342

2.260

3.020

2.356

2.370

2.300

2.245

2.321

2.811

3.162

Mini contracts

0.054 0.162 0.176 0.128 0.129 0.116 0.119 0.117

0.196 0.120 0.118

0.128

0.150

0.164

0.177

0.173

0.229

0.226

0.235

0.233

0.274

OTC

2.111 2.355 1.655 1.610 1.635 1.769 1.409 2.092

2.396 1.517 2.689

2.286

1.967

3.077

3.928

4.545

1.768

2.465

0.817

1.169

14.879

Total RPC

1.224 1.527 1.365 1.134 1.106 1.191 1.282 1.350

1.454 1.405 1.481

1.417

1.524

1.493

1.436

1.474

1.436

1.341

1.482

1.476

1.671

Updated to Oct 31, 2015.

2008

2009

2010

2011

2012

2013

2014

2015

N-14

D-14

26

Investor participation in volumes

Equities and derivatives segments
BOVESPA SEGMENT (EQUITIES)

BM&F SEGMENT (DERIVATIVES)

Updated to Oct 31, 2015.

27

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders
3Q15 RESULTS
APPENDIX
28

Income Statement
History of income statement results (consolidated)
(in BRL thousand)

2009

2010

2011

2012

2013

2014

Net revenue

1,510,569

1,898,742

1,904,684

2,064,750

2,126,638

2,030,433

Expenses

(569,832)

(633,504)

(816,664)

(763,080)

(790,814)

(804,070)

(446,677)

(543,881)

(584,521)

(563,487)

(575,763)

(592,349)

940,737

1,265,238

1,088,020

1,301,670

1,335,824

1,226,363

Operating margin

62.3%

66.6%

57.1%

63.0%

62.8%

60.4%

Equity method result

38,238

219,461

149,270

171,365

212,160

245,837

289,039

280,729

208,851

180,695

208,157

Income before taxation of profit

1,186,574

1,592,515

1,588,210

1,659,791

1,687,884

1,646,680

Income tax and social contribution

(304,505)

(448,029)

(539,681)

(585,535)

(606,588)

(660,959)

881,050

1,144,561

1,047,999

1,074,290

1,080,947

977,053

1,223,761

1,586,374

1,545,627

1,612,136

1,609,769

1,478,653

0.6104

0.7929

0.7932

0.8351

0.8389

0.8048

Adjusted expenses
Operating income

Financial result

Net income
Adjusted net income
Adjusted EPS (BRL)
Attributable to shareholders of BM&FBOVESPA.

29

Adjusted expenses and investment budget

Focus on cost control and investments phase
ADJUSTED EXPENSES BUDGET
Focus on expenses control offset most of the inflationary adjustments
over the past years
(in BRL million)

2014 vs. 2013: 2.88%

IPCA 2014: 6.41%
2015e vs. 2014: 1.71%4
IPCA (average) 2015e: 9.28%
CAGR 2010-15e: 2.07%4
IPCA (average) 2010-15e: 6.78%

INVESTMENTS BUDGET:
The CAPEX program initiated in 2010 renewed the Company's IT,
operations and service platform
(in BRL million)

Review of 2015 budget: from

R$190 220 million to R$200
230 million
Update of the timeline and budget
of the Companys main projects

Capex is expected to decline in

2016
2016e: R$165 195 million

Expenses adjusted to Companys depreciation, stock granting plan principal and social charges -, stock options plan, tax on dividends from the CME Group, transfer of fines and provisions. IPCA for
2014 released by IBGE IPCA for 2015 based on market expectations released by the Central Bank in Sep. 11, 2015; 4 Considers the mid-point of 2015 budget and high point 2014 budget

30

Expenses Breakdown
Pursuit of greater efficiency and controlling expenses

Prioritization of activities, review of contracts and enhancement of

processes has resulted in greater efficiency

1.8%

Third party
services

-12.8%

-19.5%

Marketing

-23.8%

-29.6%

-20.6%

-26.7%

Total
Personnel

Data
processing

10.2%

Real Change

48.5%

12.5%

Data
processing

-4.3%

Nominal
Change

19.7%

-14.3%
1,8%

Third party
services

Total
Personnel

2.8%

(in R$ millions)

2014 vs. 2010

-17.3%

-40.8%

Marketing

Real Change

-73.3%

-80.9%

Communicat.

Nominal
Change

Communicat.

2014 vs. 2013

-48.2%

-62.9%

(in R$ millions)

Includes personnel expenses and capitalization and excludes stock option and bonus expenses, Calculated based on the annual wage increase between 2010 and
2014 for personnel expenditure and the IPCA of services accumulated from Jan 2011 to Dec 2014 for the other lines of expenses

31

Allocation of Results
Return of surplus capital to shareholders

Distribution of most of the cash generation, reaffirming the

commitment to return capital to shareholders
Payout
(% of net income)
2009: 80%
2010: 100%
2011: 87%
2012: 100%
2013: 80%
2014: 80%
1H15: 80%

Cash Generation after Investment and Interest Payments

(Total for Jan/09 through Jun/15, in R$ millions)

Share Buyback
About 15% of free float
repurchased in 7-year
period (2H08-1H15)

Data of BM&FBOVESPA (not consolidated): excludes variation in financial transactions and collateral pledged by participants, proceeds raised in connection with the acquisition of CME Group shares in 2010.
Data from Dec 2014 and excludes third party resources (investors collateral, resources deposited in the BM&FBOVESPA Bank and others).

32

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
33

3Q15 Highlights (vs. 3Q14)

Solid operating performance; non-recurring impacts related to CME Group investments

Operating highlights

Operating income and

net income growth

Non-recurring impacts
related to CME Group

BM&F segment

Total revenues: R$662.9 MM, +11.8%

ADV: 3.3 MM contracts, +24.3%

BM&F seg.: R$306.8 MM, +34.2%

RPC: R$1.432, +8.9%

Bovespa seg.: R$221.9 MM, -15.8%

Gain on CME Group partial

divestment (sale of 1% of the total
CME Group shares)

Other: R$134.3 MM, +33.1%

Bovespa segment
ADTV: R$6.5 billion, -10.2%

Adj. expenses: R$163.6 MM, +11,4%

Margin: 5.246 bps, -0.26 bps

Other business lines (not tied to
volumes)
Sec. lending: average open interest
grew 31.1%
Tesouro Direto: assets under custody
were 45.2% higher

Proceeds: R$1,201.3 million

Gross profit: R$724.0 million
Net profit: R$474.2 million

Oper. income: R$380.5 MM, +7.9%

Discontinuity of the equity method

(remaining 4% of the total CME
Group Shares)

Adj. net income: R$457.0 MM,

+27.9%

Balance sheet: from Investment in

associate to available for sale
(marked-to-market)

IFRS net income (ex-CME): R$393.3

MM, +65.0%

Income statement: non-recurring /

non-cash pre-tax income of
R$1,734.9 MM (net R$1,145.0 MM)

Adjusted to (i) depreciation and amortization; (ii) stock grant plan costs principal and payroll taxes and stock option plan; (iii) tax on dividends from CME Group; and (iv) transfer of fines and provisions.
Adjusted to (i) deferred taxes related to the goodwill; (ii) stock grant plan costs principal and payroll taxes , net of tax deductibility, and stock option plan; (iii) investment in CME Group under the equity
method of accounting, net of taxes related to dividends; (iv) taxes paid overseas to be compensated; (v) tax credits from IoC; (vi) non-recurring impact from the partial divestment in CME Group; and (vii) nonrecurring impact from the discontinuity of the equity method of accounting. Excludes the net impacts of the partial divestment in CME Group and of the discontinuity of the equity method of accounting.

34

Strategic Developments Recent Updates

Delivering on the strategic plan

Building a world-class IT and

operations infrastructure

Products/markets development
and revenue diversification

Clearing BM&FBOVESPA

Greater liquidity for listed products

Equities phase: conclusion of substantially all IT

development in Oct15. Start integrated test phase
and certification with market participants
(launching date will depend on tests results and
regulatory approval)

Continuous efforts to expand the number of market

makers for the equities and derivatives, 22 active programs

Derivatives phase (implemented in Aug14): average

number of trades per day grew 61.8% from 2014 to
2015

Efforts to attract more lenders to the securities lending

platform (local pension funds and foreign investors)
Development of Inflation futures contracts (4 contracts relaunched in Jun15)
Enhancements to pricing and incentives

PUMA Trading System

Resilience: 851 days without any interruption

Performance: 2015 average number of messages
per day grew 325.6% compared to 2010
iBalco

Following the migration of NDF and Swaps in 1H15,

Flex Options, with and without CCP, migrated to the
new OTC derivatives platform in 3Q15
Updated until October, 2015. Until November 12, 2015

Implemented in 1Q15: DMA; securities lending; issuers;

and options on equity-based indices futures
Implemented in 2Q15: mini contracts; Int. Rate in BRL fee
rebalancing; and depositary
Implementation in 3Q15: market data; and OTC derivatives
Corporate Governance for State-Owned Companies
Provides framework for listed companies to improve
disclosure, board and management selection, internal
controls and compliance
35

3Q15 Revenue Breakdown

Business model resilience and revenues growth
TOP LINE GROWTH DRIVEN BY REVENUES FROM FINANCIAL AND COMMODITIES DERIVATIVES AND
INCREASED NON-VOLUME RELATED REVENUES
(in R$ millions)

USD-linked revenues
represented 26% of the total

Total
Revenues
R$662.9 MM

1 The

revenue breakdown considers the revenue lines others of the Bovespa segment and foreign exchange and securities of the BM&F segment, as reported in the financial
statements note 20 within the other revenues not tied to volumes. Trading and post-trading.

36

Derivatives Market
Higher volumes and FX depreciation pushed revenues up
REVENUE (in R$ millions)

ADV (in millions)

Contracts

3Q14

3Q15

YoY

Interest rates in BRL

1.51

1.79

19.0%

FX rates

0.48

0.47

-2.1%

Interest rates in USD

0.22

0.32

46.0%

Commodities

0.01

0.01

-13.6%

Mini contracts

0.32

0.60

88.5%

Stock indices

0.12

0.10

-15.8%

OTC

0.02

0.03

77.5%

TOTAL

2.67

3.32

24.3%

Contracts priced in USD represented ~24% of derivatives

ADV and ~52% of derivatives revenues in 3Q15

RATE PER CONTRACT (RPC)

RPC: R$1.432 per contract, +8.9% year-over-year
Depreciation of BRL versus USD

Mix effect (higher participation of Interest rates in BRL and Mini contracts)

Revenue does not consider the revenue lines foreign exchange and securities of the BM&F segment, as reported in the financial statements note 20, which totaled R$5.8
million in the 3Q15. Most of the fees charged on FX, Interest rates in USD and Commodities are referred in USD. The average BRL/USD rate decreased 33.9% from 3Q14 to 3Q15.

37

Equities Market
Revenues impacted by lower market capitalization of listed companies
ADTV (in R$ millions)

REVENUE (in R$ millions)

Markets
Cash Equities
Equities Derivatives
TOTAL

3Q14

3Q15

YoY

6,890.0

6,293.4

-8.7%

398.3

246.2

-38.2%

7,288.3

6,539.6

-10.3%

Average market capitalization fell 14.5% to R$2.2

trillion in the 3Q15, which was partially offset by a
higher turnover velocity of 70.8%

TRADING AND POST-TRADING MARGINS (in basis point)

Market

3Q14

3Q15

3Q15/3Q14

Stocks and Equity Derivatives

5.501

5.247

-0.25 bps

Cash Market

5.061

4.939

-0.12 bps

Derivatives

13.115

13.110

-0.01 bps

Options Market

13.145

13.157

0.01 bps

Forward Market

12.999

12.999

0.00 bps

5.502

5.246

-0.26 bps

TOTAL

Trading and post-trading margins drop 4.7%

year-over-year

Revenue does not considers the revenue line others of the Bovespa segment, as reported in the financial statements note 20, which totaled R$2.1 million in the 3Q15. Excludes
fixed income line.

38

Business Lines not Related to Volumes

Solid growth in revenues not tied to volumes
3Q15 REVENUE BREAKDOWN (in R$ millions)

+33.1%
Y-o-Y

Revenue as reported in the financial statements note 20.

39

3Q15 Adjusted Expenses

Continued focus through diligent expense management
3Q15 ADJUSTED EXPENSES GREW 11.4% Y-O-Y
IN THE NINE MONTHS PERIOD THE GROWTH WAS SIGNIFICANTLY BELOW INFLATION (6.3% VERSUS AVERAGE
INFLATION OF 9.5%)
(in R$ millions)

Adjusted
personnel
(+4.2%): grew
less than
annual wage
adjustment

Data
processing
(+7.5%): higher
maintenance
expenses
connected to
the derivatives
phase of the
new integrated
BM&FBOVESPA
Clearinghouse

Third party
services
(+47.3%):
professional
services
related to
projects

Commun.
(-66.4%):
reduction of
mailing
expenses of
custody
statements

Marketing
(+61.4%):
expenses
connected to
Financial
Markets
Conference

Others4
(+36.1%):
write-off of
R$6.4 MM,
provisions and
energy costs

(in R$ millions and % of total adjusted expenses)

3Q15

87.0 (53%)

30.4 (19%)

12.6 (8%)

1.0 (1%)

4.7 (3%)

27.9 (17%)

3Q14

83.5 (57%)

28.3 (19%)

8.6 (6%)

3.1 (2%)

2.9 (2%)

20.5 (14%)

Expenses adjusted to Companys (i) depreciation and amortization; (ii) costs from stock grant plan principal and payroll taxes and stock option plan; (iii) tax on dividends from the CME
40
Group; and (iv) transfer of fines and provisions. IPCA last 12 months until Sep15 (Source IBGE). Excluding the impact of stock grant/option expenses. 4Include expenses with
maintenance, board and committee members compensation and others.

CME Group Partial Divestment Impacts

Reducing Companys exposure to FX rates and CME Group share price
Divestment of CME Group shares
Transaction: divestment of 20% of the stake in CME
Group (equivalent of 1% of the total shares)
Reason: reduce risks exposure to FX and CME Group
share price

Impacts from sale of 1%

Income statement
EBT: R$724.0 MM
Income tax and social contribution: R$249.8 MM
Net income: R$474.2 MM

Balance sheet

Investment in CME Group over time

Assets

Liabilities

Financial investment:
R$1,201.3 MM

Tax provision:
R$249.8 MM

Tax due to be compensated against tax losses

generated by Interest on Capital distribution (no
cash impact)

Source: Bloomberg e BM&FBOVESPA. 09/08/15 (before sale), 09/09/15 (after sale), End of each
year and Jun/15.

41

CME Group Accounting Changes

Discontinuity of the equity method
Income statement
Income Statement

1. The equity in income of investee line will no longer

contemplate the investment in CME Group

1 Equity in income of investees

2. Extraordinary impact of the discontinuity of equity

method of accounting

2 Discontinuity of the Equity method

3. Dividends received from the CME Group will be

recognized as financial income and will be included in
the Companys tax base

3 Financial Income

Balance sheet
Assets
Current assets
2 Financial investments

Non-current assets
Investments
1

Interest in associate

Liabilities & Equity

Current liabilities
Income tax and social cont.

Shareholders equity
Revenue reserves
Retained earnings

Discontinuity of the equity method of accounting starting from September 14, 2015.

1. The CME Group shares cease to be treated as an

investment under non-current asset
2. The investment is now treated as available for sale
and will be measured at fair value (marked to
market)
3. Investment mark to market will impact the
shareholders equity only (no impact on income
statement in a quarterly basis after 3Q15)
4. The deferred income tax and social contribution line
now includes a tax provision on the potential gain to
be generated by this investment
42

Adjusted Net Income

Reconciliation of net income ex-CME and adj. net income
3Q15 NET INCOME

IFRS (in R$ millions)

3Q15

3Q14

Var.

2,012.5

238.4

744.2%

(1,145.0)

(474.2)

393.3

238.4

65.0%

(+) Stock Grant/Option

12.8

7.3

74.5%

(+) Deferred Liability (goodwill)

137.5

138.6

-0.8%

(-) Equity in results of investee

(37.6)

(43.7)

-13.9%

16.7

(-) IOC adjustment

(49.0)

Adjusted net income

457.0

357.4

27.9%

IFRS net income

(-) Discontinuity of the equity method
(-) Gain on disposal of investment in affiliate
IFRS net income ex-CME impact

(+) Recoverable taxes paid overseas

43

Financial Highlights
Solid and liquid financial profile
CASH AND FINANCIAL INVESTMENTS (in R$ millions)
3Q15
8,165

Companys cash and financial investments

2Q15
4,033

Unrestricted cash (available funds) includes

R$1,201.3 million from the partial divestment
in the CME Group

1Q15
4,355

Third party cash and financial investments

4Q14
3,856

Market participants cash collateral and others

include R$2,749.2 million related to a
transaction settled on Oct 1, 2015

3Q14
3,841

Ratings above the sovereign

S&P: BBB- (counterparty credit rating) / A-3 (issuer)

Third party

Total Restricted

Available

Moodys: Baa2 (global scale issuer / global notes)

Includes earnings and rights on securities in custody. Includes BM&FBOVESPA Bank clients deposits. For 3Q15, does not include investment in CME Group
(R$5,004.3 million) and in Bolsa de Comercio de Santiago (R$50.4 million), booked as a financial investment.

44

Financial Highlights
Investments and returning cash to shareholders

PAYOUT
R$314.6 MM in Interest on Capital (80% of the IFRS net
income ex-CME in 3Q15)
Payment on Dec 04, 2015

CAPEX
R$47.5 MM in 3Q15 and R$166.5 MM in 9M15
Capex budget ranges reaffirmed:
2015: R$200 R$230 MM
2016: R$165 R$195 MM

45

Financial Statements
Summary of balance sheet (consolidated)
ASSETS

LIABILITIES AND SHAREHOLDERSEQUITY

(in R$ millions)

Current assets

09/30/2015 12/31/2014

(in R$ millions)
Current liabilities

11,720.9

2,785.2

Cash and cash equivalents

3,022.6

500.5

Financial investments

8,360.7

1,962.2

337.6

322.5

19,278.6

22,478.2

1,977.0

1,522.5

1,836.3

1,392.8

Others

140.7

129.8

Investments

31.0

3,761.3

454.9

421.2

16,815.7

16,773.2

Goodwill

16,064,3

16,064.3 Minority shareholdings

Total Assets

30,999.5

25,263.5 Liabilities and Shareholders eq.

Others
Non-current assets
Long-term receivables
Financial investments

Property and equipment

Intangible assets

09/30/2015 12/31/2014
4,949.1

1,891.8

4,063.7

1,321.9

885.4

569.9

Non-current liabilities

6,428.1

4,383.2

Foreign debt issues

2,425.5

1,619.1

3,793.5

2,584.5

209.2

179.6

19,622.3

18,988.4

2,540.2

2,540.2

14,289.8

15,220.4

2,782.4

1,218.9

9.9

8.9

30,999.5

25,263.5

Collateral for transactions

Others

Deferred Inc. Tax and Social

Contrib.
Others
Shareholders equity
Capital stock
Capital reserve
Others

46

Financial Statements
Net income and adjusted expenses reconciliations
ADJUSTED NET INCOME RECONCILIATION (in R$ millions)
3Q15
IRFS net income*
Stock Grant/Option (recurring net of tax)
Deferred tax liabilities
Equity in income of investees (net of taxes)
Recoverable taxes paid overseas
IoC Adjustments
Discontinuity of the equity method (net of taxes)
Results from the selling of the CME Group (net of taxes)
Adjusted net income

2,012.5
12.8
137.5
(37.6)
(49.0)
(1,145.0)
(474.2)
457.0

3Q14
238.4
7.3
138.6
(43.7)
16.7
357.4

Change
3Q15/3Q14
744.2%
74.5%
-0.8%
-13.9%
27.9%

2Q15
318.0
12.7
137.5
(31.4)
436.8

Change
9M15
3Q15/2Q15
532.9% 2,610.0
1.1%
37.6
0.0%
412.6
19.8%
(106.8)
(49.0)
- (1,145.0)
(474.2)
4.6% 1,285.1

9M14
744.6
21.8
415.9
(128.1)
51.2
1,105.4

Change
9M15/9M14
250.5%
72.6%
-0.8%
-16.6%
16.3%

*Attributable to BM&FBOVESPAs shareholders.

ADJUSTED EXPENSES RECONCILIATION (in R$ millions)

3Q15
Total Expenses
Depreciation
Stock Grant/Option
Tax on dividends from the CME Group
Provisions
BBM impact
Adjusted Expenses

217.8
(26.1)
(19.4)
(8.7)
163.6

3Q14
192.0
(29.5)
(7.3)
(5.8)
(4.3)
1.7
146.8

Change
3Q15/3Q14
13.4%
-11.3%
164.4%
103.4%
11.4%

2Q15
198.0
(28.1)
(22.1)
(6.1)
141.7

Change
3Q15/2Q15
10.0%
-7.0%
-12.2%
42.2%
15.5%

9M15
637.3
(84.8)
(84.9)
(23.6)
443.9

9M14
553.7
(87.0)
(21.8)
(16.6)
(15.1)
4.3
417.4

Change
9M15/9M14
15.1%
-2.5%
289.5%
56.0%
6.3%

47

Financial Statements
Summary of income statement (consolidated)
SUMMARY OF INCOME STATEMENT (in R$ millions)
Change
Change
2Q15
3Q15/3Q14
3Q15/2Q15

9M15

9M14

Change
9M15/9M14

7.9%

1,673.4

1,497.0

11.8%

(198.0)

10.0%

(637.3)

(553.7)

15.1%

7.9%

356.6

6.7%

1,036.1

943.3

9.8%

64.7%

-114 bps

64.3%

-70 bps

61.9%

63.0%

-109 bps

49.0

49.5

-0.9%

40.3

21.5%

136.2

144.7

-5.8%

Financial result

86.0

47.0

82.9%

71.4

20.6%

219.0

154.1

42.1%

Net income ex-CME*

393.3

238.4

65.0%

318.0

23.7%

990.8

744.6

33.1%

Adjusted net income

457.0

357.4

27.9%

436.8

4.6%

1,285.1

1,105.4

16.3%

Adjusted EPS (in R$)

0.256

0.195

30.9%

0.243

5.1%

0.717

0.601

19.4%

Adjusted expenses

(163.6)

(146.8)

11.4%

(141.7)

15.5%

(443.9)

(417.4)

6.3%

3Q15

3Q14

Net revenues

598.3

544.5

9.9%

554.6

Expenses

(217.8)

(192.0)

13.4%

Operating income

380.5

352.5

63.6%

Equity in income of investees

Operating margin

*Excludes the net gain from the partial divestment in CME Group and the net impact from the discontinuity of the equity method of accounting
for the remaining investment in CME Group.

48

REGULATION, HISTORY, BUSINESS MODEL AND CORPORATE GOVERNANCE

Safety, resilience and transparency

BRAZILIAN MARKET OPPORTUNITIES

Main growth drivers

MAIN GROWTH INITIATIVES

Building an State-of-the-art platform

MAIN GROWTH INITIATIVES

Investments, new products and focus on the customer

OPERATIONAL PERFORMANCE
Notable global exchange

FINANCIAL HIGHLIGHTS
Cost discipline and capital return to shareholders

3Q15 RESULTS
APPENDIX
49

Bovespa Segment
Raising Capital
PUBLIC OFFERINGS (BRL billion)

PIPELINE: OFFERINGS ANNOUNCED SO FAR TO THE MARKET

IRB Brasil Resseguros
Caixa Seguridade Participaes

Excludes the portion acquired by the Brazilian government in the Petrobras offering, via the transfer of rights in barrels (BRL 74.8 billion).

50

Trading in ADRs of Brazilian companies

Liquidity migration process interrupted
Novo Mercado
Launch
(Dec. 2000)

End of CPMF
(Financial
Transaction Tax)

End of IOF Tax (2%) for

foreign investors
(Dec. 2011)

Sarbanes-Oxley Act
(Jul. 2002)

Sep15

23.4%
32.5%
9.1%

29.1%

38.4%

67.5%

Source: Bloomberg (in USD

traded value of 35 companies
with ADRs programs )

PUBLIC OFFERINGS IN NUMBER OF COMPANIES

IPOs
Follow ons
Total
Dual Listings

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
1
7
9
26
64
4
6
11
11
3
10
1
1
14
5
8
8
10
16
12
8
18
11
11
9
7
1
1
14
6
8
15
19
42
76
12
24
22
22
12
17
2
2
-

Total
154
139
293
5

51

Bovespa Segment
Foreign investment flow
MONTHLY NET FLOW OF FOREGIN INVESTMENTS (in BRL billons)

Includes public offering (primary market) and regular trades (secondary market).

Updated to October 31, 2015

52

Products and Markets Development

Creation of value and stimulus for the development of products and markets

Enhancement of Price and Incentives Policies

OTC derivatives
fee structure

Readjustment of
Issuers annual fee

Rebalancing
Trading/post-trade

Prices p/ volume
Tiers in Derivatives

2008
Charge (BPs) on
amount in
depository
Price policy for
Mkt Data

2009

2010

2011

Transfers fee
structure at CSD

Equities Market
Fee Structure

2012
Organizational
Structure for Fee
Structure

2013

2014

2015

Fee Structure of
OTC Products

Fee structure of
interest rate
derivatives
Review of prices and
incentives: BTC, DMA,
Market Data, Issuers and
Depository
53

Clearinghouses Integration and New Risk Model (CORE)

Benefits from Clearinghouse integration
OVERVIEW: CLOSEOUT RISK CALCULATION IN THREE STEPS

1. DETERMINING
THE CLOSEOUT
STRATEGY
T+0

T+1

T+2

T+3

T+4

...

T+N

2. RISK EVALUATION
T+0

T+1

T+2

T+3

T+4

...

T+N

T+1

T+2

T+3

T+4

CLOSEOUT RISK
PERMANENT LOSS

TRANSIENT LOSS

...

Defines the (stress) scenarios associated with

the dynamics of each risk factor relevant to
the portfolio. All assets and contracts are
reevaluated considering the scenarios defined
in this step (full valuation).

Calculates and aggregates intertemporally P&L

associated with each scenario, considering the
defined closeout strategy

3. POTENTIAL P&L
CALCULATION

T+0

Defines the portfolio closeout strategy which,

respecting the settlement restrictions of the
portfolio of assets/markets, should minimize
the risk of a loss associated with the closeout
process, preserving existing hedge strategies

T+N

Result: Two risk measuresmarket and

liquiditythat are estimated both jointly and
consistently

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