National Settlement Depository (NSD), Russia’s central securities depository, has summed up its operating results for 2013.
In 2013, NSD’s customers’ cash accounts turnover and its securities turnover (the market value of securities transferred in inventory operations) increased to RUB367.2 trillion and RUB168.1 trillion respectively. It is 39.8% and 27.8% more than in 2012 (RUB262.6 trillion and RUB131.5 trillion respectively).
NSD's revenues for 2013 according to RAS reached RUB33.5 billion which is 150% more than for 2012 (RUB13.6 billion). The company's expenditures for 2013 stood at RUB29.9 billion, including RUB785.6 million tax profit payments; this indicator tripled in 2013 as compared to the previous year (RUB10 billion).
The company's net profit for 2013 grew 1.6% as against the previous year up to RUB3.6 billion (RUB3.5 billion in 2012).
NSD's total equity amounted to RUB7.3 billion as of 1 January 2014 (as compared to RUB6 billion as of 1 January 2013).
Eddie Astanin, Chairman of the Executive Board, NSD, commenting on the results for 2013, said: “2013 was the year for the formation of the central securities depository in Russia and large scale changes in the Russian financial market.
The central depository, NSD, has been recognized by the global financial community as an eligible depository for the safekeeping of assets. Global investors have gained direct access to the Russian governmental debt market via Euroclear and Clearstream accounts with NSD. In 2013, NSD fulfilled such important projects as collateral management in the market of the Bank of Russia’s OTS repos with the basket of securities, clearing and DVP settlements in foreign currency on the OTC translations with securities, as well as record keeping of the OTC transactions with derivatives in the repository.
We are actively working on the creation of a corporate information center on the basis of NSD; the center will simplify the unification of the processes of data collection, processing and distribution and will help to reduce costs for market participants and issuers.
The company’s development and new product introductions are in line with the policy of ensuring the high reliability of all business processes; Thomas Murray’s rating assigned to our company confirms this reliability level.”
Safekeeping, servicing and settlements on securities
The value of securities in depository accounts opened with NSD as of 31 December 2013 increased 80.6% in comparison with the same indicator as of 31 December 2012 (RUB12 trillion) reaching RUB21.8 trillion. The market value of Russian issuers' shares on deposit with NSD as of 31 December 2013 grew by 180% (RUB12.1 trillion). The increase in aggregate nominal value of corporate and regional bonds on deposit with NSD for 2012 was 25.9% and reached RUB5.1 trillion; nominal value of Eurobonds on deposit with NSD increased by 140% to RUB564.9 billion, and the UIT units’ value grew by 33% reaching RUB205 billion.
The total number of securities on deposit with NSD grew fourfold from 18.119 trillion (as of 31 December 2012) to 73.095 trillion (as of 31 December 2013).
The number of issuers of securities serviced by NSD amounted to 3,827; this is 3.2% more as against the beginning of 2013. The number of Russian issuers increased 8.8%, amounting to 2,879. The total number of securities issues serviced by NSD reached 6,879; it makes 3.4% growth as against the data as of 31 December 2012. The number of Russian issuers’ shares serviced by NSD grew from 3,655 to 3,917 issues. The number of depository accounts including accounts opened by non-resident legal entities, increased by 6.7% since the beginning of 2013 and stood at 3,699.
The number of inventory operations for 2013 increased by 11.4% as compared to the previous year; it reached 2,606,156 operations.
The value of DVP transactions held by the participants in the OTC market using NSD's correspondent accounts opened with Clearstream and Euroclear reached RUB300.7 billion in 2013; this is 43% more in comparison with the same indicator for 2012 (RUB210.2 billion). In 2013, the number of DVP transactions increased by 90% as against 2012 and amounted to 3,558 transactions.
The value of NSD's internal DVP transactions held in the OTC market in 2013 decreased by 79.8% as against 2012 – from RUB67.4 billion to RUB13.6 billion. The number of NSD's internal DVP transactions conducted in 2013 reduced by 79.5% as compared with the same indicator for the previous year (from 259 to 53 transactions).
In 2013, 173,412 clearing operations were conducted in NSD. The value of transferred securities amounted to RUB10.1 trillion.
In 2013, the value of external FOP transactions held by the participants in the OTC market was RUB9.5 trillion; this is 70% more than in 2012 (RUB5.5 trillion). The number of external FOP transactions conducted in 2013 40% dropped as against the same indicator for 2012, amounting to 60,079 transactions.
The value of NSD's internal FOP transactions held by the participants in the OTC market grew to RUB19.4 trillion for the reporting period; this is 170% more than in 2012 (RUB7.2 trillion). The number of NSD's internal FOP transactions increased by 150% as compared to 2012 (from 106,840 to 272,359 transactions).
Cash settlements on Moscow Exchange Group's markets at the close of trading
In 2013, the aggregate cash turnover in trading bank accounts for provision of settlements between participants in Moscow Exchange Group's and SPCEX's on-exchange markets amounted to RUB328.3 trillion, including:
- on the Moscow Exchange stock market: RUB328.3 trillion (180% growth as against 2012);
- on the SPCEX stock exchange market: RUB420 million (89.7% decrease as against 2012);
Operations held via the Bank of Russia's settlement network
In 2013, the cash turnover in NSD's correspondent account with the Bank of Russia increased by 2% as compared to 2012, reaching RUB461.4 trillion.
The number of payments conducted via NSD's correspondent account with the Bank of Russia for 2013 increased by 1.4% as against 2012 and amounted to 682,381 payments.
In 2013, the turnover of NSD's correspondent account with the Bank of Russia using its RTGS system, Banking Electronic Speedy Payments (BESP) system rose by 6.3% as against 2012 and reached RUB381.2 trillion.
The number of executed payments conducted via NSD's correspondent account with the Bank of Russia using BESP system grew by 70.5% as compared to 2012, standing at 221,466 payments.
NSD remains the leading Russian paying agent on corporate and regional bonds. As of 1 January 2014, its share in the market of paying agent's services was 26.19% on the basis of all number of corporate and regional securities issues in circulation, and 30.49% based on the number of issuers of corporate and regional securities in circulation. For 2013, NSD as a paying agent accepted for servicing 31 bond issues of 18 issuers. As of 1 January 2013, the total number of bond issues serviced by NSD as a paying agent amounted to 285 issues of 118 issuers.
In 2013, NSD made 760 payments as income on registered securities (dividends, closed UITs income, revenues from repurchase of shares) in the sum of RUB74.2 billion and KZT1 million (this was by 140% more than the same indicator for 2012 — RUB31 billion) and 858 payments in the sum of RUB372.7 billion as income on corporate and regional bonds (this was 29.8% more than for 2012 – 644 payments for RUB287 billion).
This decrease in the amount of payments held by NSD as a paying agent is to take place during redemption of issues which were registered or to which the identification numbers were assigned prior to 1 January 2012 (due to a changed procedure of payment on equity securities with mandatory centralized custody which were registered or to which the identification numbers were assigned prior to 1 January 2012, and on the federal state equity securities with mandatory centralized custody regardless of their registration date).
In compliance with the change of the above mentioned procedure, in 2013, NSD as a depository providing services of mandatory centralized custody, made 720 payments as income on bonds for the total sum of RUB753.2 billion and US$40.9 million.
The sum of Eurobonds' coupon and maturity payments for 2013 amounted to:
- Ruble payments: RUB5,683 million
- Euro payments: €2.5 million
- US dollar payments: US$1,395.2 million
- British pound payments: £0.21 million
- Hong Kong dollar payments – HKD0.055 million
- Swiss franc payments: CHF0.011 million
Registration of the OTC transactions and numbering functions
On 6 February 2013, NSD began providing repository functions and maintaining a register of contracts concluded on the basis of the master agreement (the integrated agreement). In 2013, 725 organizations concluded repository agreements with NSD.
In March 2013, NSD with the support of Russia’s Public Authorities received a status of a pre-Local Operating Unit (pre-LOU) responsible for assigning pre-LEIs to market participants. In December 2013, Regulatory Oversight Committee (ROC), an international supervision organization regulating and controlling Global Legal Entity Identifier System’s (GLEIS) functioning, made a decision to integrate NSD into GLEIS as a globally endorsed pre-Local Operating Unit (pre-LOU), confirming NSD’s compliance with the principles that should be followed by a pre-LOU. Since that time, all pre-LEIs assigned by NSD shall be recognized in the international market.
Being Russia's National numbering agency, NSD assigns ISIN and CFI codes to Russian financial instruments, submits information about assigned codes to the ANNA international database and updates information about assigned ISIN and CFI codes.
In 2013, NSD assigned international ISIN and CFI codes to 1,001 Russian financial instruments and withdrew ISIN codes from 747 Russian securities.
In 2008, the Federal Financial Markets Service's Provision for Foreign Financial Instruments as Securities approved by FFMS Order #07-105/pz-n of 23 October 2007, came into effect. According to this document, NSD, acting as a member of the Association of National Numbering Agencies (ANNA), provides services related to qualification of foreign financial instruments as securities to stock market participants.
For all the time of contributing to qualification of foreign financial instruments, NSD received and processed 74,148 requests on ISIN and CFI codes of foreign financial instruments (including requests on the same instrument sent by different clients). By the end of 2013 information about 25,614 instruments was provided to the market participants; out of them 22,084 instruments conform to the FFMS qualification requirements.
Value of securities held in NSD accounts is an operational indicator which does not include the market value of balance of assets held in issuers’ accounts and treasury securities 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.
The volume of transactions conducted by OTC market participants is calculated on the basis of transferred securities' market value using NSD's methodology.
National Settlement Depository (NSD) is the central securities depository of the Russian Federation, a part of the Moscow Exchange Group. NSD was founded on 27 June 1996.
NSD is Russia's national numbering agency and the substitute numbering agency for the CIS, authorized to assign the international ISIN and CFI codes. The international rating agency Thomas Murray has assigned NSD an AA- rating as a central securities depository. Total value of assets on deposit with NSD amounted to RUB21.8 trillion as of 31 December 2013.
The status of central securities depository was assigned to NSD by the Russian Federal Financial Markets Service’s order #12-2761/PZ-I dated 6 November 2012.
NSD holds professional securities market participant license #177-12042-000100 for depository operations issued by the Central Bank of the Russian Federation on 19 February 2009, license #3294 for bank operations issued by the Central Bank of the Russian Federation on 26 July 2012 and license #077-00004-000010 for the clearing activities issued by the Central Bank of the Russian Federation on 20 December 2012.
Registered office: 12, Spartakovskaya St., Moscow 105066, Russia
For additional information about NSD please visit www.nsd.ru or connect NSD Public Affairs Division.
NSD Public Affairs Division: +7 495 232 0910