National Settlement Depository Reports Q1 2016 Results

05 May 2016
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  • The value of securities under custody grew by 15% to RUB 31.7 trillion
  • The number of transactions registered with NSD’s Repository increased by 60% to 135.7 thousand
  • 322 shareholder meetings were held with the use of the e-proxy voting technology (using the ISO 20022 standard)

Central Securities Depository’s Services

In Q1 2016, the value of assets under custody reached RUB 31.7 trillion; this was a 15% increase as compared with the same period of 2015 (RUB 27.6 trillion). The number of securities issues serviced by NSD rose by one third (from 7.6 thousand in Q1 2015 to 9.9 thousand in 1Q 2016). 31% of them were represented by foreign securities issues. Their number more than doubled from 1.5 thousand in Q1 2015 to 3.1 thousand in Q1 2016.

The number of book-entry transfers in the central securities depository (CSD) grew by 4% – to 610.1 thousand in Q1 2016 (586.1 thousand in Q1 2015), including 492 thousand on-exchange operations (+5%; 468 thousand operations in Q1 2015) and 118.1 thousand OTC operations (117.8 operations in Q1 2015).

In Q1 2016, the value of OTC DVP transactions increased considerably and amounted to RUB 794.3 billion. This was 39% more than in Q1 2015.

Collateral Management System

In Q1 2016, the value of repo transactions with the Federal Treasury performed with the use of NSD’s collateral management system was RUB 6.7 trillion; the number of transactions reached 497.

In the first quarter, the value of repo transactions with the Bank of Russia conducted with the use of NSD’s collateral management system amounted to RUB 2.4 trillion (RUB 8.4 trillion in the same period of 2015). The decline in repo trades with the Bank of Russia’s securities basket was caused by a general decline in the amount of credit organizations’ debt to the Bank of Russia in line with the new monetary policy of the regulator.

The aggregate value of repo transactions with the Federal Treasury and the Bank of Russia stood at RUB 9.1 trillion in Q1 2016.

Repository

In Q1 2016, the number of transactions registered with NSD’s Repository reached 135.7 thousand; this was almost a 60% increase as compared to the same period of 2015 (85.6 thousand). Meanwhile, the value of registered transactions remained the same: RUB 91.2 trillion in Q1 2016 against RUB 92.9 trillion in Q1 2015.

The largest number of transactions registered in Q1 2016 included transactions with the following types of instruments:

  • Currency forward (97,202);
  • Currency swap (29,323);
  • OTC repo (4,350).

For comparison, the following types of transactions were mostly registered in Q4 2015:

  • Currency forward (80,740);
  • Currency swap (34,534);
  • Share option (6,591).

Corporate Actions Center

In Q1 2016, 322 shareholder meetings were held with the use of the new e-proxy voting technology based on ISO 20022.

819 corporate actions on foreign securities were held in the reporting period; this is 85% more than in Q1 2015 (443 corporate actions).

Information services

The number of commercial services agreements increased by 15% (286 agreements). In Q1 2016, the Valuation Center accounted for the biggest growth of client number; the number of users who subscribed for the Valuation Center’s information doubled and amounted to 46 companies. Due to the expansion of the Valuation Center’s data distribution channels supported by Thomson Reuters, Interfax and Cbonds, the Center’s network spread to more jurisdictions, such as the USA, the UK, Hong Kong, India and Singapore.

NSD continues to develop the nsddata.ru information portal. It will be a single point of access to all information services and will allow to customize and import data in a modern way, as well as to use the flexible system of fees for the company’s commercial products. The nsddata.ru portal is to be launched in July 2016.

Payment and settlement system

In Q1 2016, the value of money transfers increased by 3.2% against the same period of 2015 and reached RUB 82.3 trillion (RUB 79.8 trillion in Q1 2015).

In the reporting period, the company introduced a new service allowing to process client cross-currency settlements – payment versus payment (PVP-1). PVP is a cash settlement principle increasing the reliability of settlements and assuming that a participant’s cash transfer in one currency occurs if another participant’s cash transfer in another currency takes place simultaneously.

National Numbering Agency and pre-Local Operating Unit (pre-LOU)

NSD acts as Russia’s Numbering Agency and the substitute numbering agency for the CIS countries, assigning ISINs and CFIs. NSD also functions as a pre-Local Operating Unit (pre-LOU). Legal Entity Identifiers (LEIs) assigned by NSD are recognized by regulators, market participants and pre-LOUs of other countries.

In Q1 2016, NSD assigned 17 LEIs; it was less than in Q1 2015 (118 codes). The company also verified 76 LEIs. It exceeded the previous year’s figure (13 LEIs) due to the expiration of the one-year validity period of LEIs and to LEI owners’ obligation to update the codes. One LEI was accepted for servicing from another pre-LOU.

In the reporting period, NSD assigned 334 ISINs and CFIs to Russian financial instruments (228 codes in Q1 2015); in addition, as a substitute numbering agency, NSD assigned 124 ISINs and CFIs.

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