- The value of securities on deposit 23% grew as compared to Q1 2014
- The value of transactions with derivatives reported to the repository amounted to RUB93 trillion
- The number of corporate actions1 carried out via NSD increased by 30%
Central Securities Depository's Services
During the first three months of 2015, the value of securities on deposit reached RUB27.4 trillion; this is 23% more than in the similar period of 2014 (RUB22.4 trillion).
The number of inventory operations in the CSD in Q1 2015 exceeded 586 thousand. This is 4.6% less than in Q1 2014.
In Q1 2015, the number of operations held as a result of exchange trading remained at the same level – 468.3 thousand against 467.4 thousand operations in Q1 2014 (a 0.2% increase). The number of OTC operations in Q1 2015 20% declined to 117.8 thousand as compared to Q1 2014 (146 thousand operations). These operations included 61.5 thousand DVP transactions (7% YoY decline) and 56.2 thousand FOP transactions (30% YoY decrease). It should be noted that the value of DVP transactions remained practically at the same level – RUB571.2 billion.
Collateral Management System
By the end of Q1 2015, a number of NSD clients connected to collateral management services reached 216 (by the end of Q1 2014 these services used 174 market participants). The number of transactions with the use of collateral management services increased approximately by a quarter, and reached 2,274 (1,824 transactions in Q1 2014). However, the total value of the transactions reduced in Q1 2015 amounting to RUB8.4 trillion (against RUB11.1 trillion in Q1 2014).
By the end of 2014, NSD provided the technical readiness of the project of repo transactions with the Federal Treasury with collateral management system; in Q1 2015, first transactions within the framework of the new service were conducted.
Repository
Market participants continue to prepare for the introduction of a rule of submitting mandatory reports on all types of OTC derivatives; the rule will be put into effect on 1 October 2015. As a consequence, the number of transactions registered with the NSD repository in 1Q 2015 increased more than 2.5 times YoY and exceeded 85.6 thousand2 transactions (31 thousand in Q1 2014). Value of registered transactions also grew: in Q1 2015, market participants submitted reports on OTC transactions with derivatives for a total sum of RUB93 trillion; this is twice as much as in Q1 2014 (RUB43.6 trillion). The number of the repository’s clients continues to grow – in Q1 2015 their number amounted to 1,158.
It should be noted that now market participants submit voluntary reports on transactions. The market participants were actively reporting on currency forwards: more than 38 thousand transactions were registered in Q1 2015. They also submitted reports on currency and commodity options, commodity forwards etc.
Corporate Actions Center
In Q1 2015, the number of corporate actions 30% increased as compared with the same period of 2014 – 3.53 thousand in Q1 2015 against 2.7 thousand in Q1 2014. 443 operations were conducted with foreign securities; this is by a quarter more than in Q1 2014.
NSD’s clients have an opportunity to use the e-proxy voting technology to vote remotely at shareholder meetings. In Q1 2015, 172 shareholder meetings were carried out using this technology.
In April 2015, NSD implemented international standards in its e-proxy voting service: the company launched a technology allowing to use ISO 20022 and ISO 15022 standards at all stages of the process of remote voting: from informing about a meeting to voting.
On 27 March, NSD launched a special website related to the corporate action reform – www.corpactions.ru. Issuers, depositors, registrars and other stakeholders may find a detailed description of all aspects of the reform on the website: from legal changes and timeframes to technological issues and information describing the progress of the reform.
Information services
One of the most important NSD’s tasks in Q1 2015 was a formation of a unified reference database containing all available information about issuers and their financial instruments in Russia’s securities market. Working on this task, NSD, as a key record keeping institution, united its efforts with Interfax Information Group, the leading authorized corporate information disclosure agency. At the preparatory stage of the reference database (Reference United Data or RU DATA) creation, the companies verified and integrated databases, and formed legal, marketing and technological platforms for the new product.
Another important direction of NSD’s activities was the development of flexible systems of information products’ customization with due account for depositors’ needs. The company developed plans for further development of the services and created products for new clients on the basis of results of the customized module products’ trial use held in Q1 2015. In addition, in line with the development of basic information products and services of NSD, users of SIR-NSD and DISC NSD received an access to information about mortgage participation certificate, TINs (Tax Identification Number) and registration numbers in the country of registration.
SWIFT message traffic
NSD uses SWIFT for securities operations and settlements. In particular, within the framework of the corporate action reform the SWIFT ISO 20022 format will become one of the basic formats of interactions between the CSD and issuers, registrars, custodians and other market participants. In Q1 2015, the total number of SWIFT messages reached 678 thousand. It is worth adding that the SWIFT message traffic doubled YoY within the framework of corporate actions.
Furthermore, the SWIFT system and international standards will be used in projects related to the creation of the centralized system of UIT units’ placement on the basis of NSD and in e-matching services for OTC transactions. NSD representatives take an active part in different initiatives and working groups of ROSSWIFT to implement best SWIFT practices and ISO standards.
Payment system and cash settlements
On 9 February 2015, under the development of conversion services, NSD launched a new service – the conversion payment that united two operations (the operation of currency sale and purchase and the cash transfer operation). This allowed the company to decrease a number of instructions and payment documents submitted by the clients of NSD.
In Q1 2015, the value of money transfers held in the NSD payment system increased 14.3% YoY and reached RUB79.8 trillion against RUB69.8 in Q1 2014.
National Numbering Agency and Local Operating Unit (LOU)
NSD acts as Russia’s Numbering Agency assigning ISINs and CFIs to Russian issuers’ securities and financial instruments issued or registered in the territory of Russia and the CIS countries.
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.
Russian market participants continue to receive pre-LEIs. In Q1 2015, the company assigned the record number of the codes – 118 pre-LEIs (in Q1 2014, NSD assigned 27 pre-LEIs).
In Q1 2015, NSD assigned 228 ISINs and CFIs to Russian financial instruments. This is by a third more than in Q1 2014. As a substitute numbering agency, NSD assigned 52 ISINs and CFIs in Q1 2015.
1 — As compared to Q1 2014.
2 — Including repo transactions with the Bank of Russia with securities basket.