Statements by: Angelo Tantazzi and Massimo Capuano

"The global economy progressed in a consistent manner once again during 2005" stated Angelo Tantazzi, Borsa Italiana’s Chairman "sustained by international commerce volumes on the up. The Eurozone and Italy, however, continued to disclose a slower pace. Nevertheless, during the second half of the year some signs of improvement appeared in the economic conditions of companies who are currently seeking to seize the opportunities offered by the new competitive context.

The situation of protracted and abundant liquidity which has characterized the world economy for the last three years, deeply affected the financial markets. During the year, the stock markets disclosed positive price and volume trends, driven in part by the sound fundamentals of the listed companies and by effective interest rates which are once again falling.

The Italian market consolidated the growth seen in 2003 and 2004 with the Mib index performance of 14.6% in 2005. Even a more striking progress was disclosed by companies featuring small-to-medium capitalisation, as witnessed by the growth of the All Stars index, up 33% on the start of the year.

The results obtained this year by the Italian stock markets are the effect of a favourable convergence between the evolution of the markets and the on-going improvement which the Borsa Italiana Group, as part of its activities as market and post-trading manager, has provided in terms of regulations, services and infrastructures so as to meet the needs of market participants.

The recent approval of the Law on Savings and the assimilation within the Italian regulatory framework of a number of European directives, will make it possible to increase the confidence of both investors and savers in 2006."

''The three consecutive years of growth seen by the Italian stock market, from 2003 to-date (+ 54.7% on the Mib) – emphasises Massimo Capuano, Borsa Italiana’s CEO have partly been the fruit of work carried out during this period so as to render the infrastructures of our markets more efficient and reward the decision of having concentrated on increasing the value of the Italian SMEs. The performances of the Star and TechStar indexes are, in fact, amongst the best at European level.

The work carried out this year (new segmentation of the stock market, new indexes) represents a further fine-tuning of the organisational, regulatory and technology structure of the Italian market which thus proves itself to be one of the best in the world in terms of liquidity. In 2005, the growth rates of equity and derivatives trading, on 2004 were the highest when compared with the main European financial marketplaces and the leadership of the Italian stock market was confirmed in terms of turnover velocity, an evidence of the elevated liquidity and efficiency.

The new absolute trading record on the stock market, thus greater even than the excellent levels in 2000, is the proof of the strong interest and confidence for our market shown by institutional investors and the retail public, as also confirmed by the active participation in the subscription of shares of the numerous placement operations.

The Idem, the Italian derivatives market, has seen one of the greatest periods of growth since its creation. Despite the all-out competition of the leading international derivatives markets, share futures and share options traded on the Idem experienced growth in standard contracts of 246% and 32% respectively, while open interest rose on average during the year by 37%.

SeDeX

The ETF market leaped to first place in Europe in relation to contracts on electronic systems, with a considerable increase in liquidity (approximately +168%) and the number of products listed.

It is interesting to note how during the same year Borsa Italiana has been able to efficiently accompany the considerable growth of three types of financial instruments which are intrinsically different with regards to ‘ownership’ and scheme, trading modalities, client target and type of predominant brokers.

The bond and Government securities market (MOT) was subject to innovation both from an organisational and regulatory point of view and a technological view point, involving the complete integration between Mot and EuroMot, who now both use the same technological platform which supports the stock market.

Road shows with the international financial community were stepped up, so as to promote awareness of Italian companies abroad. The already consolidated Paris, London and Frankfurt road shows were joined by ones in Tokyo and New York. We are also currently looking towards the Far East and the West Coast with increasingly greater interest.

The growing visibility of the S&P/MIB index, which represents a recognized benchmark, has contributed towards the appreciation of the Italian market at international level, and which is also confirmed by the elevated number of foreign brokers who directly access our markets (out of 125 brokers, 31% are international).

The acquisition of MTS

2006, with the re-confirmed chairmanship of the FESE (Federation of European Stock Markets), will permit Borsa Italiana to commit itself even further so as to assert its proposal-making role in the consolidation process among the various European stock markets.

At international level, the Borsa Italiana Group’s interest continues for the markets with high growth rates and an increasing opening-up to international investment: thus, important memorandums of understanding have been signed with the Tokyo, Shanghai and Shenzhen exchanges.

Monte Titoli

CC&G

BIt Systems

The activities of the subsidiary Piazza Affari Gestioni e Servizi progressed, a company which runs the Congress and Training Center at Palazzo Mezzanotte.

With a view to the on-going improvement of the markets, the All Stars, Star and TechStar indexes and the total return versions of the various Italian indexes were introduced during 2005; steps were taken to review the baskets for the Mib, Mibtel and Midex. So as to encourage the reduction of the spreads and facilitate the activities of brokers and investors, the trading ticks on shares and share futures were altered. As from the start of 2006, new trading hours will also become effective, with the aim of greater harmonisation with the European standards.

During the year, a series of measures on the pricing of the trading, clearing and settlement services was brought on stream, with a view to rationalising the structure and sharing the recoveries in efficiency with the market participants, returning part of the value created to them.

Work was started for the updating of the Code of Conduct for the governance for listed companies.

The Borsa Italiana website – www.borsaitaliana.it - has been completely overhauled with regards to navigation features and contents and is now able to count on 14 million pages visited a month and 350,000 unique visitors".

Milan, Italy, 31st December 2005