JPMorgan Chase & Co.
Jun 18, 2012

J.P. Morgan Survey Reveals Investor Optimism About Russia

Survey by Depositary Receipts business indicates investors desire improved corporate governance and investor communications at Russian companies

London, 18 June, 2012 - According to a survey released today by J.P. Morgan's Depositary Receipts (DR) business, investors are optimistic about the investment opportunities that exist in Russia over the next three years due to the country's economic growth rate, abundance of natural resources, low debt levels and healthy employment levels. The survey, conducted in March, covered 40 firms that invest in Russia and manage a combined $700 billion in equity assets.

Despite this optimism, North American and European investors said Russian companies must bolster their corporate governance standards and improve investor communications in order to attract and retain foreign investment. According to survey responses, while the country looks attractive from a macro economic perspective, government intervention, opaque corporate governance practices and a general lack of regulation to protect investors pose risks.

The survey of "Investor Opinions of Russian Companies", found the following:

Vikas Taimni, Emerging Markets Regional Head for J.P. Morgan's Depositary Receipts business, said: "The findings of our survey provide keen insights for Russian companies to attract additional foreign investment and ultimately optimize their valuation through improvements in investor relations and corporate governance."

Dennis Bon, Global Head of J.P. Morgan's Depositary Receipts business added: "The equity markets are evolving in Russia as it strives to be an international financial center. The market's strong commodity base and improvements in market infrastructure are yielding a growing interest from investors to invest in Russia."

For market information on DRs and international equities please view J.P. Morgan's award-winning web site: www.adr.com. For more information on J.P. Morgan's DR services please visit: http://www.jpmorgan.com/visit/adr.

About the survey methodology:
Between March 8 and 21, 2012, Ipreo conducted, on behalf of J.P. Morgan's Depositary Receipts Group, a telephone survey with global institutional investors from the United States, Canada, the United Kingdom, and much of Europe (Austria, Denmark, France, Germany, Norway, Sweden, and Switzerland) in order to gain insight into how Russian companies can improve their overall investor relations and corporate governance practices and to generally understand these investors' disposition toward Russian equities.

In total, Ipreo received feedback from 40 firms that invest in Russia. As of December 31, 2011, these firms managed a combined $700 billion in equity assets, $13.3 billion of which represented holdings in Russian companies, or 21 percent of all Russian equities held by active investment managers outside of Russia. Of these firms, 75 percent are traditional investment advisers/mutual fund managers, while 25 percent are hedge funds.

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