Growing interest in cross-border investing drives many DR market metrics to new highs

NEW YORK, July 11, 2007 — American and global depositary receipt (DR) trading, assets and index values continued to grow rapidly during the first six months of 2007, according to The Bank of New York Mellon. Nearly $1.3 trillion of DRs traded on U.S. and non-U.S. markets and exchanges during the first half of 2007, up 34% year-on-year. Issuers from 13 countries completed 53 new primary and follow-on DR offerings, raising a half-year record $25.8 billion — 72% higher than 2006's mid-year total.

Also during the first half of 2007, companies from 15 countries established 60 new sponsored DR programs. Industry-wide, a record 2,015 sponsored DR programs from 76 countries with an estimated¹ asset value of $1.33 trillion are now available. Overall DR price performance, as tracked by The Bank of New York ADR Index^SM, closed at a record high 185.05, up 10.7%, year-to-date and up 26.6% during the past year.

"Unprecedented interest in cross-border investing continues to drive the expansion of the DR market and we are ideally positioned to service this growth," said Christopher Sturdy, executive vice president and head of The Bank of New York's Depositary Receipt Division. "As a result of the recent merger between The Bank of New York and Mellon, our DR issuer clients, as well as their investors and brokers, will benefit from enhanced stock transfer capabilities and the market perspective gained as one of the world's largest asset managers."

Growing Interest in Cross-Border Investing Drives DR Liquidity to Unprecedented Levels

The half-year's DR trading value was easily an all-time high and was higher than every full-year total before 2006. The major U.S. stock exchanges, the New York Stock Exchange (NYSE), NASDAQ and the American Stock Exchange (Amex), remained the largest markets for DR trading, comprising 88% of DR trading value worldwide. A record 32.9 billion U.S.-listed DRs, valued at $1.1 trillion, traded on the U.S. markets during the first half of 2007. Compared with 26.9 billion DRs, valued at more than $782 billion at mid-year 2006, this represented increases of 22% in DR trading volume and 41% in DR trading value year-on-year. The most actively traded U.S. listed DRs included Brazil's CVRD and Petrobras, Finland's Nokia, Mexico's America Movil and China's Baidu.com.

European-listed DR trading also exhibited strong growth. The London Stock Exchange (LSE) reported that $195 billion of DRs traded on the International Order Book (IOB), the primary trading platform for both LSE and Luxembourg Stock Exchange (LuxSE)-listed DRs. At the mid-year mark, IOB trading value was 30% higher year-on-year and the six-month figure was also higher than every full-year total before 2006. Six Russian companies topped the IOB's list of most actively-traded DRs including Gazprom/, Lukoil and Norilsk Nickel.

Over-the-Counter (OTC) and other DR trading value was estimated by The Bank of New York to amount to $50 billion. The most active OTC-traded DR issuers included Switzerland's Nestle and Roche Holding.

Assets in DRs Grow as U.S. Investors Diversify Internationally

The total value of U.S. investment in non-U.S. equities (both DRs and non-U.S. shares) increased to $4.1 trillion as of March 30, 2007, an increase of 21% from the same time last year and a record high, according to the latest U.S. Federal Reserve statistics. Non-U.S. equities accounted for a record 19.7% of all equity investment in the U.S.

DR issuers continued to derive significant benefits from the continued interest in cross-border investing. The Bank of New York Mellon estimated1 that the total value of investment in DRs increased more than 20% year-on-year and exceeded $1.33 trillion at the end of the first quarter 2007, an all-time high. Investment values in U.S.-listed DRs totaled $900 billion on March 31, 2007, a jump of 43% from the same time last year. Overall value of investment in European-listed DRs was estimated to be $250 billion and investment in OTC-traded and other DRs was estimated to be $180 billion.

Among individual issuers, the U.K.'s BP, continued to have the world's largest DR program by a significant margin, valued at $61 billion. Other issuers with more than $30 billion in DR investment assets included Russia's Lukoil and Gazprom, the U.K.'s Royal Dutch Shell, Mexico's America Movl, and Brazil's Petrobras.

Record Amounts of Capital Raised in DRs

The record amount of initial public offerings and follow-on offerings completed with DRs was another market highlight. During the first six months of the year, 52 new DR offerings by non-U.S. companies and governments raised a half-year record $25.8 billion — 72% higher than 2006's mid-year total of $15 billion in 62 new DR offerings. Capital raising transactions during the first half of 2007 were dominated by issuers from the BRIC countries — Brazil, Russia, India and China. Together these issuers raised $20.9 billion in 40 transactions. The remaining 12 offerings were completed by issuers in nine countries, all but one emerging markets.

The half-year's clear highlight was the May initial public offering of Russia's VTB Bank which raised nearly $8.8 billion in total and $5.2 billion with its LSE-listed DR tranche. VTB was the second largest DR offering of all time and was also notable because it had the distinction of being the 2000th sponsored DR program available to investors. Other significant initial public offerings with DRs were completed by Russian property developer AFI Development, which listed on the LSE and Indian mining and metals producer Sterlite Industries which listed on the NYSE. Both issuers raised more than $1.5 billion in DRs. Significant follow-on offerings were completed by Taiwan Semiconductor Manufacturing and India's ICICI Bank. Both issuers raised more than $2.5 billion in DRs.

BRIC Issuers Dominate New DR Program Establishment and Stock Exchange Listings

During the first half of 2007, 60 new DR programs from issuers located in 15 countries were established. The figures are a decrease of 12 programs from last year's mid-year statistics. Of 2007's new DR programs, 30 were listed on stock exchanges; equally split between U.S. stock exchanges and European stock exchanges. The remaining 30 DR programs trade on various OTC markets.

Fully 80% of the half-year's new stock exchange listings were completed by issuers from the BRIC countries. Continuing recent trends, Brazilian and Chinese issuers preferred the U.S. stock exchanges while Russian and Indian issuers preferred the European markets.

In aggregate, there are now approximately 813 DRs listed on U.S. and non-U.S. stock exchanges, 10 less than a year ago. The decrease is primarily due to the fact that a number of DR issuers took advantage of amended U.S. Securities and Exchange Commission (SEC) regulations that make it easier for non-U.S. companies that are not actively traded in the U.S. to leave U.S. exchanges and withdraw from U.S. reporting requirements. The amended rules took effect on June 4th, six weeks before a deadline for these companies to comply with auditing standards in the Sarbanes-Oxley Act. It should be noted, however, that most of the DR issuers that have de-listed from the U.S. exchanges have chosen to keep their DR programs available to investors in the form of Level I ADRs traded on the OTC market.

The Bank of New York ADR Index Closes at A Record High and Outperforms U.S. Domestic Indices

Overall DR performance, as tracked by The Bank of New York ADR Index^SM, posted strong returns during the first half of 2007. On June 29, 2007, The Bank of New York's Composite ADR Index^SM closed at a record high 185.05, up 10.7%, year-to-date and up 26.6% during the past year. All three of the regional sub-indices and all 15 market, sector and select sub-indices ended higher year-to-date. More broadly, 32 of 36 country indices were up year-to-date, led by the ADR indices of Peru, Israel, Finland and Russia. Most of the ADR indices continued to beat the major U.S. domestic market indices. As of June 29, 2007, the Dow Jones Industrial Average was up 7.6% for the year while the broader Standard & Poor's 500 Index gained 6%.

Hong Kong's City Telecom was the half-year's best-performing ADR Index constituent, returning 174%. Other triple-digit increases were posted by China's Trina Solar and China Eastern Airlines, France's Wavecom and Brazil's Petrobras. An additional 25 constituents returned more than 50% during the past six months.

At the mid-year mark, the Composite ADR Index^SM had 401 constituents and a free float market capitalization, as defined by Dow Jones & Company, in excess of $7.6 trillion. The Bank of New York ADR Index is the only real-time index to track all DRs, New York Shares and global registered shares traded on the NYSE, Amex and NASDAQ.

The Bank of New York Demonstrates Leadership and Innovation

During the first six months of 2007, The Bank of New York, a subsidiary of The Bank of New York Mellon Corporation, solidified its depositary leadership position across a broad range of metrics acting for 63 percent of all new DR programs, 65 percent of all DR capital raising transactions and 48 percent of global DR trading volume.

The Bank of New York also partnered with DR issuers to develop new structures that foster access to new pools of capital. During the past six months, the Bank helped Brazil's MMX become the first Brazilian company to list on the Toronto Stock Exchange with the first ever listing of DRs on the Exchange. The Bank of New York Mellon also became the first "Principal American Liaison" on the new International OTCQX when Australia's Starpharma became the first DR traded on that market.

During the first six months of 2007, the Bank continued to attract experienced DR issuers. Germany's Fresenius Medical Care and Taiwan's Fubon Financial switched their depositary bank to The Bank of New York during the past six months. Overall, 175 issuers have switched 214 DR programs to The Bank of New York from other depositary banks since 1990.

In total, The Bank of New York acts as depositary for 1,273 American and global depositary receipt programs, a 63 percent market share, acting in partnership with leading companies from 60 countries. With an unrivalled commitment to helping securities issuers succeed in the world's rapidly evolving financial markets, the Bank delivers the industry's most comprehensive suite of integrated depositary receipt, corporate trust, and stock transfer services. Additional information is available at www.adrbny.com.

The Bank of New York Mellon Corporation (NYSE: BK) is a global financial services company focused on helping clients move and manage their financial assets, operating in 37 countries and serving more than 100 markets. The company is a leading provider of financial services for institutions, corporations and high-net-worth individuals, providing superior asset and wealth management, asset servicing, issuer services, and treasury services through a worldwide client-focused team. It has more than $18 trillion in assets under custody and administration and $1 trillion in assets under management, and services $11 trillion in total outstanding debt. Additional information is available at www.bnymellon.com.

¹Research Approach: The total value of investment in DR is derived by multiplying DRs outstanding by DR price. All DR price figures are publicly available from the applicable stock exchange or trading market. The number of DRs outstanding for The Bank of New York DR programs was derived from internal reporting sources. The number of DRs outstanding from non-Bank of New York sponsored U.S.-listed issues was derived from publicly available figures provided by the NYSE and NASDAQ. DRs outstanding for European-listed and OTC-traded issues that are not serviced by The Bank of New York were estimated by The Bank of New York using publicly available information including, but not limited to, company reports and SEC 13-F shareholder data.

This information and data is provided for general informational purposes only. The Bank of New York does not warrant or guarantee the accuracy or completeness of, nor undertake to update or amend, this information or data. We provide no advice nor recommendation or endorsement with respect to any company or securities. Nothing herein shall be deemed to constitute an offer to sell or a solicitation of an offer to buy securities.

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