Equities Reach 44.6% of NDC Securities Turnover for 1H 2008

17 July 2008
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MOSCOW - The National Depository Center (NDC), Russia’s only settlement depository servicing the full range of Russian securities, announced today its operating results for 1H 2008. NDC's securities turnover (the market value of securities transferred in inventory operations) rose 24% for 1H 2008 reaching RUR28.7 trillion (RUR23.155 trillion for the comparable period of 2007). Joint stock company shares constituted the largest portion, at 44.6%. The turnover of the shares was RUR12.798 trillion or 13.5% more than for 1H 2007. The value of securities held in NDC accounts as of 30 June, 2008 was up 3.8% in comparison with 1H 2007 reaching RUR4.385 trillion (RUR4.221 trillion for 1H 2007).

The number of inventory operations conducted for 1H 2008 rose 7.6% to 1,267,116, including 995,621 inventory operations with shares (78.5% of total number of operations). The number of depository accounts rose 2.5% since 1 January, 2008 to 1,769 as of 30 June 2008 or 7.5% more compared with 1H 2007.

The total number of securities issues serviced by NDC as of 30 June, 2008 rose by 18.9% against 1 January, 2008 reaching 2,859 (or 38.6% more against 30 June, 2007).

The number of issuers whose securities are serviced by NDC increased by 71 to 1,320 companies as of 30 June, 2008. The number of share issuers for the reporting period rose by 53 to 710 joint stock companies. The number of bond issuers rose from 576 to 592. The number of UIT and investment fund managing companies increased by 14 to 99.

Nikolay Egorov, NDC Director, commenting on 1H 2008 results, said: "Given the stable situation in the Russian stock market, in spite of the global financial crisis, it is worth noting the positive dynamics of NDC's operational indicators which reflect the company's leading position in Russia's settlement and depository services market. Compliance by NDC's activities with international standards has been recognized already. We are focused on the further development of our services, improvement of their quality and the strengthening of NDC's role as the central unit in Russia's stock market infrastructure."

For instance, the international rating agency Thomas Murray, which assesses central depositories' operations all over the world, has upgraded NDC's rating to AA-, which means very low risk and conforms with the levels of risks of the leading US and European depositories. The agency has also taken into consideration the results of an independent audit of NDC's operations conducted by Deloitte & Touche CIS CJSC in 2008.

The Speedy Settlement Scheme (SSS) implemented jointly by NDC and ING Wholesale Banking and focused on increase of efficiency of the foreign investors' operations with joint stock companies' shares in Russian market and in depository receipts market is being used successfully. The turnover for the period of SSS functioning reached RUR39.22 trillion.

Interactions between NDC and Euroclear Bank have been successfully put into operation. This has allowed NDC customers to settle transactions and retain international securities via NDC’s direct account at Euroclear Bank. The rules of direct account servicing allow NDC clients to gain access to a wide range of financial instruments including Eurobonds, state and corporate bonds of issuers representing more than 30 foreign markets, and the shares of companies circulated in 27 foreign markets.

The company is expanding the number of securities admitted for circulation through the NDC-DCC "Bridge" (a system linking Russia’s two leading trading systems – MICEX and RTS - and a means for facilitating securities transfers between NDC, which services MICEX-listed securities, and Depository Clearing Corporation (DCC), which services RTS securities). The number of issuers admitted for circulation through the "Bridge" reached 85 as of 30 June, 2008, and the number of securities issues circulated through the "Bridge" was 263.

As the National numbering agency for Russia, NDC assigns ISIN and CFI codes to Russian financial instruments, incorporates them to the international database and updates the information of Russian ISIN and CFI codes in the database.

NDC, a member of the Association of National Numbering Agencies (ANNA), has ongoing responsibilities for code confirmations and the expediting of procedures for code assignment for foreign financial instruments.

As of 30 June, 2008, NDC had received and processed requests on approximately 15,000 financial instruments (including requests on the same instrument sent by multiple clients). In the course of request processing, the company determined that there were requests for information on 6,334 instruments, out of which 1,132 did not have CFI codes including 188 instruments which also did not have ISIN codes. A further 354 instruments, including 123 depository receipts, had CFI codes which did not conform to ISO 10962 and FFMS qualification requirements. Some 4,848 instruments had CFI codes in compliance with FFMS qualification requirements.

Note:

Value of securities held in NDC accounts is an operational indicator which does not include the market value of other assets held in issuers’ accounts. The value of shares and units of Unit Investment Trusts is based on market value, and the value of bonds is based on nominal value.

About NDC:

Not-for-Profit Partnership “The National Depository Center” is the largest settlement depository in Russia, servicing the full range of equity securities of Russian issuers. It services 100% of transactions conducted in the federal bond and the Bank of Russia bond markets, more than 95% of transactions conducted in the corporate and regional bond markets, and stock exchange share transactions. NDC provides storage of global certificates and depository accounting for 99% of corporate bond issues, and 95% of sub-federal and municipal bond issues. The international rating agency Thomas Murray has assigned NDC an АА- rating as a central depository. For 1Q 2008 the value of assets in storage was more than RUR4.2 trillion. NDC is the largest paying agent on behalf of corporate bond issuers. It is Russia's national numbering agency, the substituting numbering agency for the CIS, authorized to assign the international ISIN and CFI codes. It is also a member of the international accounting infrastructure, providing settlements on the global financial markets using direct accounts at Clearstream Banking S.A. and Euroclear Bank. It also holds accounts at the Central Depository of the Republic of Kazakhstan and the NDC of the Republic of Azerbaijan.

Among NDC’s founders are MICEX and Bank of Russia (the founders’ shares in the property of NDC are 46.7% and 39.3% respectively, and in the votes 50.2% and 42.3% respectively). Members include GPB OJSC (Gazprombank), Evrofinans Mosnarbank, Rosbank, VTB Bank (Vneshtorgbank), Bank of Moscow, Rossiysky Credit Bank, Vneshekonombank, ING Bank Eurasia, JP Morgan Bank International LLC, UniCredit, Deutsche Bank, and Sberbank. The Partnership also has a stake in Depository Clearing Company CJSC (36.96 %) and in Settlement Depository Company CJSC (28.54%).


 For further information about NDC: www.ndc.ru, or NDC Public Affairs Department: +7 495 232 0910, .


 

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