HONG KONG, LONDON and NEW YORK, September 20 /PRNewswire/ --     FTSE Group, the global index provider, announced today the
result of its annual review of the classification of countries into developed
and emerging market categories. FTSE classifies countries into three
categories; Developed, Advanced Emerging and Secondary Emerging, within its
FTSE Global Equity Index Series (GEIS), which is used by institutional
investors worldwide. A Watch List of countries under review for promotion or
demotion within these categories is also published annually by FTSE.

FTSE, helped by an expert committee of market practitioners,
reviews quality of market criteria for all stock markets included in FTSE
GEIS to assess the ease, cost and security of underlying investment
transactions by international investors in all countries. During the past
year, international investors and stock markets on the Watch List have
engaged with FTSE in reviewing the progress made and the FTSE Policy Group
has approved that the following country classification changes be made:

1) Israel will be promoted to Developed status from June 2008.
Israel meets all quality of markets criteria for a Developed market and
has done so since being included on the Watch List in 2006. A new FTSE
Index for Developed markets in Europe, Middle East and Africa will be
introduced for those investors wishing to integrate Israel within their
existing Developed Europe portfolios;

2) Hungary and Poland will be promoted to Advanced Emerging status
from Secondary Emerging from June 2008. Both countries now meet the
quality of markets criteria for Developed markets but will continue to be
classified as Advanced Emerging until their World Bank GNI Per Capita
Rating classification is upgraded to High; and

3) Pakistan will be removed from the FTSE Global Equity Index
Series in June 2008 as the stock market fails to meet the minimum entry
requirements for quality of markets criteria. A separate country index
for Pakistan will be maintained by FTSE for those international investors
wishing to continue to invest in Pakistan.

Greece will remain on the Watch List and continue to be
assessed for demotion from Developed to Advanced Emerging status. Some
aspects of the Greek market remain restricted to international investors and,
although progress has been made, the market continues to fall short of the
requirements of a Developed market in respect of the following criteria:

(i) Delivery free of payment allowed for transferring securities between
accounts;

(ii) Off-exchange transactions freely allowed;

(iii) Omnibus custody account facilities available to international
investors;

(iv) Short sales restrictions; and

(v) Liquid stock lending market.

The Athens Exchange and Greek Capital Markets Commission are
both committed to work with FTSE and together the three organisations have
set up a working party under the direction of the Chairmen of the Exchange
and Capital Markets Commission and the Chief Executive of FTSE to agree and
implement viable solutions to the above issues in the first half of 2008,
some of which are addressed by the MIFID Directive. The success of this
initiative will be assessed by FTSE's expert committee at the next annual
review of country classifications in September 2008 when a final decision
will be made to classify Greece as either a Developed or Advanced Emerging
market for 2009 and beyond.

The FTSE Policy Group also approved that the following countries remain
included on the Watch List for 2008:

1) South Korea will continue to be assessed for promotion from
Advanced Emerging to Developed status. Significant changes have been made
to regulations and investment procedures in South Korea to assist
international investors. In addition, an improvement plan has been
published to remove restrictions on the free delivery of securities
between accounts and to ease off-exchange transactions. Once these
improvements are implemented, the only outstanding quality of markets
criterion for Developed markets not then being met would be the removal
of restrictions in the foreign exchange market.

2) Taiwan will continue to be assessed for promotion from Advanced
Emerging to Developed status. Whilst FTSE and investors are pleased to
recognise that the exchange and regulator have made significant
improvements, market access remains restricted to international investors
in four critical areas:

(i) Free and well developed foreign exchange market;

(ii) Liquid stock lending market;

(iii) Delivery free of payment allowed for transferring
securities between accounts; and

(iv) Off-exchange transactions freely allowed.

3) China 'A' share will remain on the Watch List for possible
inclusion in the FTSE Global Equity Index Series. A substantial increase in
QFII investment and the removal of foreign investment restrictions are
required to meet the requirements to join the FTSE Global Equity Index
Series.

Lindsay Tomlinson, Chairman of the Policy Group, commented:
"The FTSE engagement process on country classification is of enormous value
to the industry. It brings together asset managers, investment banks,
exchanges and regulators to improve knowledge and understanding of the issues
and barriers to trading efficiency across markets. The dialogue is
facilitating major improvements in market practice with real benefits to all
participants".

Mark Makepeace, Chief Executive of FTSE, said: "Markets on the
Watch List have made very significant changes to their regulations and
investment procedures and systems to assist international investors to invest
in their markets and are to be congratulated on the progress made. I hope
that these markets will remain engaged in this process and that further
markets that are close to achieving Developed status achieve this goal at the
next annual review in September 2008".

To allow investors to anticipate the impact of turnover, investment
flows, and country weightings that the changes above will have on FTSE
indices, a set of FTSE Watch List Indexes are available. The Watch List
Series reflects current market conditions, but with changes to the markets
outlined above already implemented.

For full details about FTSE's country classification process and the
current status of all countries in the FTSE Global Equity Index Series,
please visit http://www.ftse.com/country. More information about the FTSE 
Watch List Series is available at www.ftse.com/watchlist.

Notes to Editors

About FTSE Group

FTSE Group is a world-leader in the creation and management of indexes.
With offices in Beijing, London, Frankfurt, Hong Kong, Madrid, Paris, New
York, San Francisco, and Tokyo, FTSE Group services clients in 77 countries
worldwide. It calculates and manages the FTSE Global Equity Index Series,
which includes world-recognized indexes ranging from the FTSE All-World
Index, the FTSE4Good series and the FTSEurofirst Index series, as well as
domestic indexes such as the prestigious FTSE 100. The company has
collaborative arrangements with the Athens, AMEX, Cyprus, Euronext,
Johannesburg London, Madrid, NASDAQ and Taiwan exchanges, as well as Nomura
Securities, Hang Seng and Xinhua Finance of China. FTSE also has a
collaborative agreement with Dow Jones Indexes to develop a single sector
classification system for global investors.

FTSE indexes are used extensively by investors world-wide for investment
analysis, performance measurement, asset allocation, portfolio hedging and
for creating a wide range of index tracking funds. Independent committees of
senior fund managers, derivatives experts, actuaries and other experienced
practitioners review all changes to the indexes to ensure that they are made
objectively and without bias. Real-time FTSE indexes are calculated on
systems managed by Reuters. Prices and FX rates used are supplied by Reuters.