December 2010

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.

BRAZILIAN MARKET OPPORTUNITIES

Brazil represents a unique investment opportunity

Rio Olympics 2016 and World Cup 2014

Pre-salt Oil Exploration

Increase in Income Levels

Interest Rate Decline

Brazilian per capita income will rise from US$7,900 to US$10,900 in 2011 (Bank of America Merrill Lynch)
(1)

New growth cycle and investments in infra-structure

Brazil will have the 6th highest world purchasing power by 2013 (Price Coopers) (1)

Development of Mortgage Market

Expansion of Middle Class

Greater Internal Demand

Entrepreneurial Stimulus

(1) As of Jan/10.
4

Brazilian Capital Markets: high growth potential High Growth Potential Number of Custody Accounts(1)
Nov10 644,055

Low penetration of equity and derivatives in the main investors portfolios

Stable and low interest rate environment would encourage exposure in securities Recent growth in the number of retail investors, but still low compared to other markets
128,615

Low number of listed companies compared to other countries

jan/05 jul/05 jan/06 jul/06 jan/07 jul/07 jan/08 jul/08 jan/09 jul/09 jan/10 jul/10

HFT to Total Volume Traded(2)

Equities
66%

2009 Listed Companies (28th in the World)

6,408 5,179 3,700 3,472

Futures

35%

3540%

3540%

3,019 2,792

2,335

1,966 1,788 386

5-10%

5-10%

US

EUR

BR

US

EUR

BR

ndia

USA

Canada

Spain

China /HK London

Japan

Australia

Korea

Brazil

(1) Updated until Oct/2010; (2) HFT: High Frequency Trading - Source: Rosemblatt Securities Inc.;

Source: WFE
5

MAIN INITIATIVES TO INCREASE GROWTH

Main Strategies to Attract Retail Investors

2010 launching of the campaign Quer ser Scio?

New Campaign Quer ser Scio?

Brings the concept quer ser scio? (wanna be a shareholder?) as a differential to attract new investors. The campaign will be released in mass medias All the pieces will have a reference to the campaign web site www.quersersocio.com.br

Other Popularization and Education Initiatives

Launching of the on line (web) version of the Desafio BM&FBOVESPA

Launching of the Turma da Bolsa, a financial education web site for kids;
Beginning of the second season of the Educao Financeira program, with 42 episodes to be exhibited from March to December 2010 ENEF printing and distribution of books for the schools which participate of the pilot project, and beginning of the development of the contents for school Fica Mais mileage and member get member program for investors
7

BOVESPA Segment: capital raising activity Increasing the Sales Activity: attracting more companies to be listed
Separate Listing from Issuer Development activities (regulation and sales) Public Offerings in 2009/2010 24 public offerings in 2009 (6 IPOs and 18 Follow-Ons), raised more than BRL 46.0 bi 20 public offerings in 2010 (10 IPOs and 10 Follow-Ons), raised BRL 72.9 bi* Pipeline Also, there are 6 additional offerings in the pipeline IPOs (5): Sonae Sierra Brasil S/A, Autometal, Raia, Desenvix Energias Renovveis and QGEP Participaes Follow-Ons (1): Anhanguera Educacional Participaes
Public Offerings (BRL billions)
IPO Follow-On
14.5
62.4

22.2 15.1 4.3 4.5

2004

55.6
26.8

8.5 5.4
2005

15.4
2006 2007

23.8 7.5
2008 2009

10.5
2010*

* Updated until Dec 6th excluding capitalization with barrels reserves by federal government.

New Developments

Company focus on becoming a global marketplace

Equity Order Book in Foreign Currencies

New Products Pipeline

BM&FBOVESPA and Chi-X Global Term Sheet for joint development of software
Trading of stocks listed in Brazil with simultaneous FX execution - allows non residents to match stocks in US$ and other currencies Legal requirements to invest in Brazil keep unchanged

Non-Sponsored BDR Level 1

Deutsche Bank will be the first depository institution and will list 10 large cap stocks listed in the US (Start of trading in October 5, 2010) Citibank was chosen to list 10 other large cap stocks (Start of trading in October 5, 2010)

ETFs BRL million

Only 7 ETFs listed on the Exchange Financial Index ETF to be launched in 4Q10 Other ETFs under development: Dividends,
Utilities and IBRX-20

26.6 25.6 21.7 22.023.5 21.5 20.3 18.3 16.9 8.8

5.3 11.4

33.1 32.733.1 27.1 30.8 29.1 25.3 27.2 22.2 26.7 24.5

Apr-09

Feb-09

Sep-09

Apr-10

Mar-09

Dec-09

Mar-10

Sep-10

Feb-10

Jun-09

Jun-10

Oct-09

Jul-10

Jul-09

Aug-09

Nov-09

Aug-10

Oct-10

Jan-09

Jan-10

May-09

May-10

Nov-10

Exploring global partnership initiatives

Globally preferred strategic partners Development of new multi-class trading platform Reciprocal participation in CME and BVMF Board of Directors Increase of BVMF stake in CME from 1.8% to 5.0%

Order routing
International market data distribution Nasdaq OMX product licensing to Brazilian companies High frequency international link and greater capability to support trading

10

IT DEVELOPMENT, DMA EVOLUTION AND HIGH FREQUENCY TRADING ACTIVITY

11

IT Excellence in IT Solutions and Post-Trading Services Developments

Initiatives to support future growth
Market Access Co-location

Capacity: phase II implemented in Jul10; Bovespa Segment: launched in Sep10 Market Data Distribution: Unified Market Data Feed - UMDF for both segments (by 4Q10) EntryPoint: unified order entry interface for both segments (by 2Q11) ISVs: Trading Technologies (TT) will provide screens for BM&F Segment in 1Q11 Brazil Easy Investing (partnership with Chi-X): order book in USD and other currencies
Trading Systems (Mega Bolsa and GTS) New Trading System: project commenced in Feb10

Schedule: Derivatives and cash FX (1Q11), Equities (1Q12) and Fixed income (2Q12) Capacity Increasing BOVESPA Segment: from 1.5 million to 3 million trades / day (by 4Q10) BM&F Segment: from 200 thousand to 400 thousand trades / day (completed in the 3Q10) Performance: improving performance in both systems (one digit latency by YE10)
Post-trading Developments Data Center: rent of a facility for the new back up site and the construction of the main site

Clearing Integration: ongoing delivery of some integration basics and project planning for
2011 new clearing infrastructure

Sungard/GMI (back office for FCMs): to be implemented in 4Q10

12

Excellence in IT solutions and Post-Trading services

Managed growth to support retail and high frequency trading: DMA Implementation (Direct Market Access) Trading Systems: reduce latency and increase capacity RCB Development (new BM&FBOVESPA Communication Network)
NET

Traditional DMA

NET

Via DMA Provider

NET

NET

Provider of DMA

Direct Connection
NET

Via DMA Co-location Remote access tracking and maintenance

Application of Co-location

13

BM&F Segment: DMA Order Routing Evolution

DMA ADTV in thousands of contracts

1100

19.7% 17.6% 16.0% 20.1% 84 164 279 161 204 214 13.5% 16.6%

900 700

13.9% 21 14.4% 176 156 327 11.3% 7.5% 3 20 51 71 30 195 197 13 92 129 216

138 223 148

16.0% 156 240 44

20.4%
17.7% 162 270 204 46 290 51 203

161 317

20% 16% 12% 8%

16.9%
162

151 254

156 262

47

500 300 100 -100

189
70 451

48 367

40
353

5.5% 4
157

380

337

416
276

551

350

4%
0%

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 nov-10

Traditional DMA

CME Globex

DMA Provider

CoLocation

% of DMA in overall ADTV

* Updated until November 30, 2010

14

High Frequency Trading - HFT New Products Pipeline Main Characteristics

New pricing policy (both segments)

Differentiated fees by tier only for day trades transactions executed by a registered HFT A HFT Committee created to approve and monitor the HFTs The new pricing policy is being implemented in two steps: Nov10 and Jan11 (consolidated volume executed in more than one broker)

Bovespa Segment
In the Bovespa Segment, different tiers were created for individuals and non-individuals HFT investors
Individuals ADTV tier (BRL millions) Up to 4 (inclusive) From 4 to 12.5 (inclusive) From 12.5 to 25 (inclusive) From 25 to 50 (inclusive) Above 50 Non-individuals ADTV tier (BRL millions) Trading Fee (%) Up to 20 (inclusive) 0.019 From 20 to 50 (inclusive) 0.017 From 50 to 250 (inclusive) 0.014 From 250 to 500 (inclusive) 0.012 Above 500 0.010

Trading Fee (%) 0.019 0.017 0.014 0.012 0.010

BM&F Segment
In the BM&F Segment, the 70% flat discount was replaced by a volume tiered based discount, only for day trades
15

BM&F Segment: High Frequency Trading (HFT)

HFT is playing an important role in derivatives market HFT (ADTV in thousands of contracts and mkt. share)* HFT (participation per group of contracts)
22 active participants in Oct10
60.7%

6.0%
3.8%
77 41 69

93
50 155

4.4%
90 43 74

4.0% 4.5% 5.7%

85
40 92 87 45 73 98 43 58

6.4%
125 45

5.3%
59 92

4.8% 2.8%
0.3%
4 4

23.7%
10.3%

1.0%
7 20

22 18 5 41

53 44 50

38
89

75

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10

FX Equities Mini contracts

Jul-10 Aug-10 Sep-10 Oct-10 Nov-10

% in Overall Volume

Interest Rates

FX contracts

Index-based contracts

Mini contracts

Co-location
BM&F Segment (thousands of contracts)

BM&F Segment: 28 units Both Segments: 8 units Pipeline: 40 units

0

Seven active investors

3.3% 3.2% 2.6% 3.2% 4.1% 164 162 162 151 156 1.4% 84 25

4.8% 203

2.9% 161

12

15

13

17

20

Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10

Updated until: November 30h, 2010 16

Improving IT Capacity and Performance

Round Trip Time, in milliseconds Equity Market

2007 450

2008 300

2009 10

2010e One digit

Derivatives Market

70

25

10

One digit

Network Carrier

RCCF`s Sole Provider

8 Networks (RCB)

Throughput in thousands of trades Equity Market Average Capacity Daily Average Market peaks 390 153 343 770 245 414 1,500 332 591 3,000 432 800

Derivatives Market Average Capacity

Daily Average Market peaks

55
23 42

200
29 49

200
39 76

400e
68 152

17

OPERATIONAL HIGHLIGHTS

18

BOVESPA Segment: operational highlights

Average Daily Traded Value - ADTV (BRL Billions)
4.9 1.2
2.004

5.5

5.3

6.5

6.8

6.6

6.5

6.9

7.3
5.8

6.7

7.8 6.3

5.4

5.6

1.6

2.4

2.005

2.006

2.007

2.008

2.009

YTD*

jan-10 f ev-10 mar-10 abr-10 mai-10 jun-10

Jul-10 Aug-10 Sep-10 Oct-10 nov-10

Daily Average Number of Trades (Thousands)

431 332 245 424 489

409

393

405

399

395

408

448

511

463

153 54 2.004 62
87

2.005

2.006

2.007

2.008

2.009

YTD*

jan-10 f ev-10 mar-10 abr-10 mai-10 jun-10

Jul-10 Aug-10 Sep-10 Oct-10 nov-10

Number of Custody Accounts (Thousands)

508 576 581 580 540 551 559 548 543 538 661 645 644

Turnover Velocity** (12 months average)

56.4%
36.8% 37.6% 38.7% 30.8% 29.4% 42.3% 63.2% 66.6% 64.4%

1Q08

2Q08

3Q08

4Q08

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

Oct10 Nov10

2001

2002

2003

2004

2005

2006

2007

2008

2009

*Updated until: November 30th, 2010

**Relation of the trading value in the cash market and the market cap of the exchange

19

Market Overhang
Impacts from the Petrobrs offering

Petro vs. Vale (Brazil trading)

Average Daily Number of Traded Shares (millions)
47
45

Overhang in the Market

Turnover Velocity* (%)
160% 140% 120%

22 1921 21 2021

25 24 22 2124 19 21 18 20 16

2929 2122 20 21 20 15 17 20

29
16

100%
80%

60%
40% 20%

0%

VALE

PETR

Total do Mercado

Vale

Petr

Average Daily Traded Value (BRL billions)

7.8 7.3 6.5 5.4 6.8

Price Level Evolution (Sep09 = 100)

9,0 180

1,8

1,6 6.6

1,4

6.9 6.5

8,0

1,2

6.7

1.3 0.8

7.3
5.8 5.6

1.3

6.7

160 7,0
6,3 6,0 140
5,0 120 4,0 3,0 2,0

0.9 0.9 0.90.9 0.9 0.9 0.8 0.8 0.8 0.7 0.8 0,8 0.7 0.7 0.7

1,0

0,6

0,4

0.9 0.8 5.4 0.9 0.9 0.7 0.7 0.6 0.4

1.2 1.0

0,8 0,8

100

80

0,2 -

1,0 60 -

VALE

PETR

Overall Volume

Petr3

Petr4

Vale3

Vale5

Ibovespa

* For the overall market, it is the result of the annualized monthly value traded in the cash market on the average market capitalization. For VALE and PETR , it is the result of the annualized monthly number of shares traded in the Brazilian cash market on the average outstanding sharecount.

20

Brazilians stock trading breakdown

End of CPMF (Financial Transaction Tax)

Novo Mercado Launching

100% 90% 80% 70% 60%
50%

Sarbanes-Oxley Act (SOX)

Nov10

30.0%

43.3%

13.3%

40% 30% 20% 10% 0%

Feb-10

26.4% 56.7% 30.3.%

Apr-10

1997

2000

2001

2004

2007

1996

1998

1999

2002

2003

2005

2006

2008

2009

Mar-10

Sep-10

Jun-10

Jul-10

Aug-10

Oct-10

Jan-10

Other USA Venues - Brazilian ADRs

NYSE - Brazilian ADRs

BM&FBOVESPA - companies with ADRs

BM&FBOVESPA (except companies with ADRs)

Source: Bloomberg (in USD traded value of 35 companies with ADRs programs )

IPOs Follow ons Total Dual Listings

*Updated until 10/29/2010

2001 14 14 -

Public Offerings in Number of Companies 2002 2003 2004 2005 2006 2007 2008 1 7 9 26 64 4 5 8 8 10 16 12 8 6 8 15 19 42 76 12 2 1 1 -

May-10

2009 2010* Total 6 10 127 18 10 109 24 20 236 1 5

21

Nov-10

BM&F Segment: operational highlights

Average Daily Traded Volume - ADTV (thousands of contracts)
3,117 3,054 2,468 1,740 1,573 1,521 1,167 805 852
167 192

2,863 2,479

2,442

1,906
90 548

162 112 88 150 80 473 124 447 535 68 109 1,633 187 74 266 86 168 988 110 843 789 711 501 422
jul-05 YTD*

1,980 189 2,063 75 176 96 202 75197 603 79 611 220 477 97218 467 106 181 228 159 106 168 479 96 670 80 104 78 642 530 540 489 525 2,270 2,171 2,121 1,988 1,669 1,483 1,278 1,193 1,267 1,135 1,255 2,184
170
Jul-10 Aug-10 Sep-10 Oct-10 nov-10

2,138

2,738

jun-05 jun-05 jun-05 jun-05 jun-05

jan-10 fev-10 mar-10 abr-10 mai-10 jun-10

BRL Int. Rate (Thousands)

FX (Thousands)

Index (Thousands)

Others (Thousands)

Rate per Contract - RPC (BRL)

2004 Interest rates in BRL FX rates Stock Indices Interest rates in USD Commodities Mini contracts OTC Total RPC 0.887 4.002 1.561 1.999 7.159 1.199 1.620 2005 0.962 2.858 1.688 1.385 5.693 0.038 1.703 1.467 2006 0.906 2.244 1.419 1.094 4.749 0.034 1.571 1.247 2007 0.950 1.859 1.501 0.965 3.195 0.054 2.111 1.224 2008 1.141 2.065 2.145 1.283 3.587 0.162 2.355 1.527 2009 0.979 2.161 1.620 1.357 2.307 0.176 1.655 1.365 YTD* 0.907 1.919 1.536 1.150 2.135 0.127 1.602 1.149 J-10 0.971 1.968 1.466 1.104 1.711 0.133 1.588 1.254 F-10 0.977 2.005 1.716 1.319 2.029 0.139 1.408 1.308 M-10 0.722 1.837 1.372 1.239 1.934 0.129 1.626 0.961 A-10 0.780 1.872 1.616 1.203 2.281 0.136 1.790 1.031 M-10 0.961 1.752 1.313 1.145 1.890 0.122 1.646 1.171 J-10 1.044 1.908 1.643 1.137 2.216 0.133 1.895 1.274 J-10 0.893 1.983 1.372 1.086 2.021 0.124 1.684 1.084 A-10 0.952 1.954 1.619 1.072 2.266 0.130 1.973 1.167 S-10 1.054 2.030 1.466 1.071 2.232 0.121 1.384 1.287 O-10 1.016 1.926 1.758 1.103 2.544 0.118 1.318 1.258 N-10 0.887 1.975 1.484 1.230 2.151 0.125 1.384 1.092

*Updated until: November 30th, 2010 22

Interest Rate in BRL Contracts

Structural changes behind the growth in volumes

Interest Rate in BRL Contracts Breakdown by Maturity (thousands of contracts)

1.200

Uncertainty in consensus impacts short term contracts

1.000
800

600
400

200
-

2007

2008

2009

2010 1st. Maturity

Jan-10

Feb-10

Mar-10

Apr-10

May-10

Jun-10

Jul-10

Aug-10

Sep-10

Oct-10

Nov-10

2nd. Maturity

3rd Maturity

4th. Maturity

5th Maturity

Fixed Rate Credit in BRL billions

700 600 500 400 300

Public Debt / Fixed Rate - in BRL billions

700
600

500
400 300 200 100 0 Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10

200 100 0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10

Source: Brazilian Central Bank

23

Brazilian Investment Funds Industry

Recent development

Investment Funds: Portfolio Breakdown (BRL billions)

1,549
1,361

1,604
21%
11%

1,597 21%
11%

1,633 21%
11%

1,654

1,190
770 10% 815 11% 972 12% 13%
10%

14%
16%

1,222 18%
10%

21%
12%

21%
11%

28% 55%
2003

8%

29% 52%
2004

8%

17% 63%
2005

8%

23%

24%
47%
2007

23%

24%

23% 45%

23% 45%

24%

24%

54%
2006

48%
2008

44%

44%

44%

2009

Jul-10

Aug-10

Sep-10

Oct-10

Fixed Income

Multimarkets

Equities

Others*

* Others include: Asset backed securities, real estate, FX, off-shore and retirement funds

Investment Funds: Multimarket and Equities Evolution (BRL billions)

324 212 61 233 167 67 81 270 211 121 123 368 286 184
179

368

363

389

400

174

180

181

2003
* Brazilian Hedge Funds
Source: Anbima

2004

2005

2006

2007

2008

2009 Equities

Jul-10

Aug-10

Sep-10

Oct-10

Multimarkets

24

BM&F Segment: open interest Derivatives Open Interest (millions of contracts)

45,0

40,0

Interest Rates in BRL Total Open Interest

Nov/10 41.5MM

35,0

Nov/10 34.1MM

30,0

25,0

20,0

15,0

10,0

5,0

0,0 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10

25

BUSINESS MODEL

26

Fully integrated Business Model

Diversified sources of revenues Services for issuers and Commodities trading
Listing (stocks, bonds, funds, asset-backed securities, Among others )

Trading, Clearing and Depository Activities

Others Services
Custody (services provided for funds and other market participants) Market Data

Trading (stocks, derivatives, corporate and government Bonds, funds, spot US Dollar, among others)

Commodities Certification

Central Counterparty (CCP) Clearing and Settlement (for all products)

Indices Licensing Central Depository (stocks and corporate bonds) Software Licensing (used by brokerage Houses and other market participants) OTC Derivatives (registration and collateral management)

Securities Lending (stocks and corporate bonds

27

Business Model, regulation and competition

Brokers & investors

Regulation prohibits internalization of orders, dark pools and ATS/MTFs, stocks trading in both exchange and OTC simultaneously Settlement and clearing of stocks trading must be done through a CCP Settlement and clearing at the beneficial owner level make the Brazilian market safer and more resilient

Trading

Under the regulation in place, potential competitors would be obliged to provide the same integrated solution, with the same rules and transparency

The final investor pays the exchange fee

Pos-Trading

Other exchanges have been seeking integrated models (self clearing models) Naked access is not allowed Naked short selling is not possible
28

Business Model

Listed Exchange Business Model

Diversified and Integrated Integrated Derivatives Diversified but Not Integrated*

* Do not provide post-trading services for the equity market

Market Capitalization (US$ billions) and 2009 EBITDA Margin (%)

35 30

80.2%
71.3% 64.9%

Updated until: 12/03/2010

74.3% 62.7% 51.9%
43.1% 60.8% 66.5% 56.7% 80,0% 70,0%

25 20
15 10 5

48.7%
39.0%

60,0% 50,0%
40,0% 30,0%

25.6

20.8

16.3

12.8
Deutsche Boerse

20,0%

8.5
ICE

7.6
Nyse Euronext

7.1
SGX

6.6
ASX

HKEx CME BVMF

4.5
Nasdaq

3.4
LSE

10,0%

2.6
TMX

2.1
BME

0,0%

Source: Bloomberg

Diversified and integrated

Derivatives

Diversified but not integrated

EBITDA Margin 2009

29

Fully integrated Business Model

Competitive all-in cost

Brasil

USA

Stock Exchange

Trading Clearing

Central Depository Securities Lending

Trading

Central Counterparty (CCP) Intermediary in the trading activity Clearing Securities Lending s activity

Brokerage House

Intermediary in the trading activity

Counterparty risk on the Internalization of orders (1)

USD28.0 Stock Price All-in cost: USD0.015

USD14.0 Stock Price All-in cost: USD0.008

Total Cost 5.3 bps

1.3 Bp 0.6 Bp 1.9 Bp 1.5 Bp
Broker Cost 1.5 bps Exchange Cost 3.8 bps

23.7%

27.6% 10.9%

All-in Transaction Cost Comparison / Services Offered to Investors

11.5% 36.3%

34.4%

28.6%
Broker trading Fee Exchange Trading fee Exchange Clearing fee

27.2%

Exchange Depository fee

(1) Not allowed according to Brazilian regulation. Assumptions: 3 months holding period; Brazilian Investment fund trade; 1.5 Bp Broker Fee; and Securities lending not considered.

30

Equity market settlement structure: Brazil compared with USA BRAZIL

All the trades must be matched on an exchange environment

USA
Brokers can internalize orders

Broker

TRF Trading on the Exchange BVMF

Dark Pools

BATS
NYSE

Direct Edge
Nasdaq DTCC

Clearing (CCP)

BVMF

BVMF

DTCC

Central Depository Broker Level

Beneficial Owner Level

31

Appendix

32

US Exchanges and Trading Venues: market share

USA Consolidated Equities Volume Breakdown (Oct10)

2.4% 10.2% 19.4%

Nasdaq + BX
NYSE + Arca TRF (Adjusted) Dark Pools 27.4% BATS

8.9%
13.5% 18.2%

EDGX + EDGA Other

Source: Rosenblatt Securities Inc. Trading Talk

33

Institutional Investors will Broaden their Participation in Capital Market

Pension Funds Brazilian Pension Funds Investments Breakdown Dec 2009
7.5% 33.3% 8.1% 21.1%
445
450 451 458

Brazilian Pension Funds: asset evolution (BRL billions) 515 510 515 513 509
480 479
469

485

491

499 498

506

504

59.3%

70.8%

Dec-08

Aug-09

Dec-09

Apr-09

Oct-09

Nov-09

Feb-09

Sep-09

May-09

Feb-10

Fixed Income

Equity

Others

Brazilian Pension Funds: equity investments portfolio*

R$163.8 bi

Brazilian Pension Funds: projected asset growth (% GDP) 40%

13%

14%

14% 15%

16%

17%

15%

17%

18%

R$46.7 bi

30.4%

27.7%
2002 May/10

In September, 2009, the limit the pension funds are allowed to invest in stocks increased from 50% to 70% of their total portfolio
Source: ABRAPP
34

May-10

Jun-09

Mar-09

Jul-09

Mar-10

Total

Total without Previ

Apr-10

Jan-09

Jan-10

Performance of BOVESPA Segment Individual investors

On Line Trading

35% 30% 25% 20% 15% 10%

5%

Nov10 27.1%

Nov10 15.8%

0%

Jan-03 Aug-03 Mar-04 Oct-04 May-05 Dec-05 Jul-06

% traded value

Feb-07 Sep-07 Apr-08 Nov-08 Jun-09 Jan-10 Aug-10

% number of trades

35

BOVESPA Segment: foreign investment flow

Monthly Net Flow of Foreign Investments* (in BRL billions)

9.1 7.3 6.0 2.9 0.9 -0.6 -1.8 -2.8 -4.7 0.5 -0.4-0.6 -1.2 1.4 5.3 5.7 6.1 4.2 2.5 2.1 1.4 0.7 -0.1 -1.5 1.5 5.5 5.2 5.8

10.0

4.4 2.1

-1.0

-0.6

-2.1

-7.3

*Includes regular trades and public offering; updated until November 30th, 2010.

36

Operational highlights: investor s participation in Total Volume

BM&F Segment (Investors Participation in Total Volume)
2%

7%
12% 24%

2% 7% 15%
25%

2% 9%

3% 8% 19% 23%

3% 8% 20%

2% 5% 22%

3% 5% 23%

2% 3% 22%

2% 4%
24%

2% 4% 26%

1% 4%
25%

1% 3% 22%

1% 4% 23%

2% 4% 22%

2% 4% 22%

2% 4% 22%

17%
23%

24%

27%

26%

30%

26%

25%

29%

32%

29%

28%

31%

34%

56%

51%

49%

48%

45%

43%

43%

42%

44%

43%

40%

41%

42%

44%

40%

39%

2005

2006

2007

2008

2009

Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Individuals Foreign Investors Institutional Investors Financial Institutions

Central Bank

Companies

Bovespa Segment (Investors Participation in Total Value)

12% 2%

10% 36% 27%

2%

10% 35% 30%

2%

8%

3% 7% 2% 34% 26%

9%

2%

9%

2%

9% 27% 30%

2%

9% 28%
35%

2% 2% 2% 3% 2% 2% 2% 7% 2% 7% 8% 8% 8% 7% 9%

33% 27%

35% 27%

28%
29%

28% 29%

30% 34%

28% 35%

28% 36%

28% 35%

31%

33% 32%

35%

35%

32%

25%
2005

25%
2006

23%

27%

31%

31%

32%

31%

25%

27%

26%

28%

27%

24%

23%

24%

2007 2008 2009 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Individuals Institutional Investors Foreign Investors Financial Insitutions Companies Others
37

Income Statement
Change 3Q10/3Q09 27,0% 41,5% 25,5% 6,0% 25,8% 27,1% 26,5% 27,5% 35,7% 36,5% 18,8% -4.2 pp 28,4% 0.7 pp 15,0% -8.4 pp 35,0% Change 3Q10/2Q10 2,8% 1,4% 6,0% -4,2% 2,6% 2,8% 16,8% -3,3% -0,2% 3,0% -4,7% -4.7 pp -1,5% -3.1 pp -8,7% -10.1 pp 17,2% Change 9M10/9M09 31,7% 34,0% 37,4% 12,7% 31,7% 31,7% 8,6% 45,9% 23,9% 43,9% 33,3% 0.8 pp 44,9% 6.5 pp 33,9% 1.4 pp 23,0%

(in thousands of BRL) Operational Revenues Trading / Clearing Systems - BM&F Trading / Clearing Systems-Bovespa Other Operational Revenues Revenue deductions Net Operational Revenues Operating Expenses Operating Income Equity account Financial Income Income before Taxes Net Income Net Margin EBITDA EBITDA Margin Adjusted Net Income Adjusted net Margin Adjusted Operational Expenses

3Q10 541.609 186.802 274.812 79.995 (54.743) 486.866 (167.561) 319.305 23.142 77.407 419.854 293.208 60,2% 336.375 69,1% 389.205 79,9% (145.846)

3Q09 426.505 132.017 219.019 75.469 (43.510) 382.995 (132.502) 250.493 57.042 307.535 246.795 64,4% 262.039 68,4% 338.377 88,4% (108.062)

2Q10 526.986 184.139 259.309 83.538 (53.365) 473.621 (143.494) 330.127 77.546 407.673 307.614 64,9% 341.671 72,1% 426.272 90,0% (124.418)

9M10

9M09

1.579.255 1.199.004 541.154 403.930 790.615 575.534 247.486 219.540 (159.640) (121.219) 1.419.615 1.077.785 (444.839) (409.460) 974.776 668.325 23.142 222.649 179.758 1.220.567 848.083 882.643 661.949 62,2% 61,4% 1.012.672 698.709 71,3% 64,8% 1.217.945 909.523 85,8% 84,4% (384.846) (313.006)

38

Revenues
Growth due to the market recovery
Bovespa segment revenues In BRL thousands 3Q10 541,609 232,890 3Q09 426,505 210.117 % Change 3Q10/ 3Q09 27.0% 10.8%

274.8
219.0
25.5%

Gross operating revenues BOVESPA Trd. / Sttmnt

BOVESPA Others*
BM&F Trd. / Sttmnt

41,922
186,802

8,902
132,017

370.9%
41.5%

3Q09
BM&F segment revenues

3Q10

Other operating revenues Depository and custody

Vendors

79,995 21,447
15,352 11,317 10,928 12,714 1,762 2,117 4,358 3Q10 2,428.1 1.167 5,905.8 6.162

75,469 17,235
16,082 11,491 9,562 8,866 3,535 2,194 6,504 3Q09 1,422.3 1.391 5,214.4 6.296

6.0% 24.4%
-4.5% -1.5% 14.3% 43.4% -50.2% -3.5% -33.0% % Change 3Q10/3Q09 70.7% -16.1% 13.3% -0.134bp
39

186.8 132.0
41.5%

Trading access (Brokers) Listing Securities lending Bolsa Brasileira de Mercadorias

3Q09
Other revenues

3Q10

Settlement Bank Other

80.0 75.5
6.0%

Operating performance BM&F ADTV (thousands) BM&F RPC (in BRL) BOVESPA ADTV (in BRL million) BOVESPA Margin (in bps)

3Q09

3Q10

* It includes the fee from the settlement of the Petrobras Offering

BOVESPA Segment
Strong market recovery in the last two months
Revenue share Average Daily Traded Value (ADTV)

13.3%
51%

Average market capitalization 18.0% higher than 3Q09 52.7% growth in the ADTV of local institutional investors Turnover velocity decreased to 59.2% in 3Q10 from 62.6% in 3Q09 (it was 71% in Oct10 )

Trading / Settlement margin

-0.13bp

Decrease to 6.16bps from 6.30bps, due mainly to the increase in the participation of local institutional investors in the overall volume, once this group of investors pay a lower fee in comparison with other investors

Recent recovery in the equity market ADTV (BRL billions) 31.7% 13.3% -11.6%

5.2

6.8

6.6

6.7

5.9

5.4

5.6

6.7

7.8

3Q09

4Q09

1Q10

2Q10

3Q10

Jul-10

Aug-10

Sep-10

Oct-10
40

BM&F Segment
Despite the reduction of uncertainty in the market, volumes are still high
Revenue share Average Daily Traded Volume ADTV

70.7%

Climb in interest rates in BRL volumes (119.8% growth) 4.0% increase of FX volume and 21.2% increase of index based contracts

Average Revenue per Contract - RPC

34%

Increase in the participation of interest rates in BRL contracts in the overall volume, to 68.4% from 53.1% Negative impact due to FX appreciation (FX, interest rates in USD and commodities contracts) The higher the volume, the lower the RPC (volume tier based pricing) Growth of HFT and DMA in the overall volume

-16.1%

Structural growth in the derivatives market (ADTV in millions of contracts)

Additional ADTV f rom outlier months - Mar'10, Apr'10 and Jul'10 (millions) ADTV excluding outlier months (millions) 2.4 1.7 1.6 1.5
0.3

3.1 3.1 1.4 1.3 1.9 1.7 1.6 1.5 1.4 1.4 1.5
1.7 1.4 1.6

1.9 2.2

2.5

2.9
2.1

2.4

2.0 2.1

2.1

Aug-09

Sep-09

Nov-09

Dec-09

Sep-10

* Updated until October 2010

2007

2008

2009

YTD*

Apr-09

Oct-09

Apr-10

Oct-10

Feb-09

Mar-09

Feb-10

Mar-10

Jul-09

May-09

May-10

Jan-09

Jun-09

Jan-10

Jun-10

Jul-10

Aug-10

41

Operating Expenses Breakdown

Expense breakdown In BRL thousands 3Q10 (167,561) (71,687) 3Q09 (132,502) (63,883) % Change 3Q10/ 3Q09 26.5% 12.2%

3Q10
10% 7%

Operating Expenses
15%

Personnel

Data processing
43%

(27,400)
(15,067) (12,293) (6,622) (15,772)

(24,233)
(11,546) (9,370) (6,219) (5,841)

13.1%
30.5% 31.2% 6.5% 170.0%

Deprec. and amortization Outsourced services

9% 16%

Communication Marketing

Personnel Dep. and Amort. Marketing

Data processing Third party serv. Other

Maintenance
Board compensation Other

(2,529)
(1,507) (14,684)

(2,750)
(1,184) (7,476)

-8.0%
27.3% 96.4%

3Q09
5%
7%

13%

In BRL thousands Operating expenses

48%

3Q10 (167,561) 15,067 5,489 2,003 (845) (145,846)

3Q09 (132,502) 11,546 11,937 957 (108,062)

% Change 3Q10/3Q09 26.5%

Depreciation Stock option plans Tax related to equity accounting Provision for doubtful accounts Adjusted operating expenses

9% 18%

35.0%
42

2010 Opex and Capex Budget Reviews

Opex Review

Launch of a mass media campaign under the slogan Quer ser Scio? (Wanna be a partner?), which focuses on attracting new local retail investors Increase in personnel expenses, especially in IT and business development areas

Hiring brought forward to support IT initiatives undertaken by the company (development of new network structure and a new trading system) and to deal with other initiatives (market popularization programs, international partnership and products development) Also, due to the payment of variable compensation

Capex Review
Replacement from a single target to a range 2010 new Opex and Capex budgets Opex budget BRL millions
145,846 124,418
114,582
66,198 57,360

Adjusted Opex in 2010 (BRL thousands) Growth in personnel, IT and marketing

From BRL540 to BRL545 million

520
2010 old
27,400

540
2010e

54,718

21,266 5,328 33,270

1Q10

24,642

Capex budget BRL millions

From BRL250 to BRL272 million

9,870
32,546
2Q10

15,772 36,476
3Q10

272
2010 old

250
2010e
43

Others

Marketing

Data processing

Adjusted Personnel

Financial Highlights
Solid financial position with strong cash generation
Cash, cash equivalents and investments (BRL millions) Financial income

264

BRL77.4 million in 3Q10: 35.7% higher than 3Q09

1,911

Financial revenues: BRL100.6 million in 3Q10, 52.7% increase compared to 3Q09, mainly due to the increase of the average interest rate than 3Q09, mainly due to the financial cost of debt

3Q10

1,022

491

3,688

Financial expenses: BRL23.2 million in 3Q10, 162.4% higher

Capex

309

BRL44.1 million in 3Q10: BRL36.2 million in IT and BRL7.9 million in other areas. The main projects were capacity increase and the new trading platform
9M10: BRL138.1 million

2Q10
939 487 1,924

3,659

Buyback program

Market participants cash collateral and others* Restricted f unds
Subsidiaries**

From Aug10 to Nov10, 26.4 million shares were bought within the program (BRL362 million) The company can buy up to 31 million shares until Dec10

Earnings distribution (payout)

BRL235.9 million as dividends, representing 80% of the GAAP Net income in 3Q10 To be paid on November 25, 2010, based on the ownership prevailing as of November 11, 2010

Available f unds

*Includes market participants cash collateral, earnings and rights on securities in custody and dividends and interest on capital pending payment ** Includes third-party deposits (BRL175 million in 2Q10 and BRL142 million in 3Q10) and restricted funds (BRL10 million in both 2Q10 and 3Q10) from BM&F Settlement Bank.

44

Balance Sheet
In BRL thousands

ASSETS
Current assets Cash and cash equivalents Financial investments Others Non-current assets Long-term receivables Financial investments

Sep 10
3,143,141 42,890 2,917,792 182,459 19,217,204 1,099,771 727,517 372,254 1,643,962

Dec09

LIABILITIES AND SHAREHOLDERS' EQUITY

Sep'10
1,422,836 984,766 438,070 1,698,725 1,027,188 616,448 55,089 15,905

Dec09
1,142,076 810,317

3,474,540 Current liabilities 50,779 Collateral for transactions

3,295,356 Others
128,405 Non-current liabilities 17,383,299 Financing 973,305 Deferred Inc. Tax and Social Contrib. 605,648 Others 367,657 Minority interest in subsidiaries 39,723 Shareholders' equity

331,759
352,872 2,495 300,930 49,447 16,356

Others Investments

19,238,784 19,362,891

Property and equipment

287,869

241,939 Capital Capital reserve

2,540,239

2,540,239

16,533,760 16,512,260 148,880 294,036

Intangible assets TOTAL ASSETS

16,185,602 22,360,345

16,128,332 Others 20,857,839

TOTAL LIAB. AND SHAREHOLDERS' 22,360,345 20,857,839 EQUITY

45