MOSCOW - The National Depository Center (NDC), Russia's only settlement depository servicing the full range of Russian securities, announced today an extension with leading insurer Ingosstrakh of an insurance policy covering criminal and professional liability. The policy liability limit was fixed at USD 50 million for all claims for the duration of the policy (from Sept. 1, 2008 to Aug. 31, 2009), and potentially for any single claim during the period. Including internal funds allocated for the purposes, the total amount of liability cover is now over USD110 million. The re-insurers behind the policy include Lloyd’s syndicates (UK), as well as several large German re-insurers.
Nikolay Egorov, Director, NDC, said: “The insurance cover established by NDC is one of the highest insured liability limits among Russian financial institutions. The total amount of NDC’s insurance cover including NDC’s internal funds can be compared with insurance cover of major banks and is the largest among Russia’s settlement depositories. Measures taken by NDC to decrease risks, its significant insurance cover, the continuing increase in NDC’s capitalization combined with optimization of tariffs, improvement of the company’s financial stability and corporate governance system allow our clients, market participants and stakeholders to be confident in NDC’s reliability and guarantee our clients’ safety.”
Nikolay Galushin, Deputy General Director, Ingosstrakh, added: “Extension of the insurance contract with NDC is an important event for our company. For the Russian insurance market, USD 50 million insurance cover of a security market participant requires foreign re-insurance. In this aspect NDC’s insurance policy can be regarded as a benchmark indicator reflecting re-insurers’ confidence, and in particular Lloyd’s approach to the risks for Russian securities market participants and to the general situation in the Russian stock market. This allows us to plan re-insurance protection for other major contracts, and to improve insurance and re-insurance agreement terms. Moreover, NDC for us represents a benchmark in risk management systems, a status which has been confirmed by the high ranking assigned by Thomas Murray, a respected agency, and by its stable good performance. From the point of view of an insurance company all this represents good reason for our high opinion of the company managers’ and in particular its risk managers’ contributions.“
The following activities, carried out in accordance with NDC’s securities market licenses, its charter and client contracts, are covered by the new policy: clearing and depository activity; activity on depository related services; and activity relating to the safekeeping of securities but not connected with depository activity.
Under the contract, an insured event is considered a situation in which damage is inflicted upon the policy-holder and third parties (including, but not limited to NDC clients), as a result of improper activity by third parties or employees of the policy-holder, including electronic and computer crimes, operations with forged documents, securities and monetary funds, as well as damage as a result of unintentional mistakes and errors, made by the policy-holder’s employees and executives while carrying out their professional duties.
In accordance with the insurance policy, an insured event is a fact determining the policy-holder’s liability to compensate for Third Parties’ losses emerging from the policy-holder’s managers’ or employees’ operations, mistakes, negligence or omission while implementing insured activities.
Insurance coverage applies to insured events which occur during the period of the insurance policy’s duration. The insurance policy covers losses first discovered to have been incurred by the policy-holder in connection with events which occurred after 1 Sept., 2002.
About Ingosstrakh:
Ingosstrakh Open Join Stock Insurance Company (www.ingos.ru) has operated in the domestic and international market since 1947. The Company is the leader among Russian insurers in terms of the size of insurance premiums in voluntary insurance, other than life insurance.
Ingosstrakh is authorized to render all types of insurance services (with a view to underwriting specialization) provided in Article 32.9 of the Russian Federation’s Law “About Insurance in the Russian Federation,” and reinsurance services. The Company operates in 214 Russian cities. Six representative offices and nine subsidiary companies of Ingosstrakh operate in the CIS and other countries.
Ingosstrakh holds ratings from Standard & Poor’s (BBB-, Stable Outlook, and ruAA+ National Scale) and Expert RA (A++).
For further information about Ingosstrakh: +7 495 234 6003, +7 495 960 3609, +7 499 978 8092,
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. NDC provides storage of global certificates and depository accounting for 99% of corporate bond issues, sub-federal and municipal bond issues. It services 100% of transactions conducted in the federal bond and the Bank of Russia bond markets, more than 99% of transactions conducted in the corporate and regional bond markets, and more than 99% of stock exchange transactions with equities and OTC trades. The international rating agency Thomas Murray has assigned NDC an АА- rating as a central depository which means very low level of risk. For 1H 2008 the value of assets in storage was RUR4.4 trillion. NDC is the largest paying agent on behalf of corporate bond issuers. It is Russia's national numbering agency, and 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, the NDC of the Republic of Azerbaijan and the Republican Central Depository of Securities (Republic of Belarus).
Among NDC’s founders are MICEX and Bank of Russia (the founders’ shares in the property of NDC are 46.67% and 39.35% respectively, and in the votes 50.16% 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 stakes in Depository Clearing Company CJSC (37.29%), in Settlement Depository Company CJSC (28.54%) and in Bank "National Clearing Centre" CJSC (0.67%).
For further information about NDC: www.ndc.ru, or NDC Public Affairs Department: +7 495 232 0910,