National Settlement Depository (NSD), Russia’s central securities depository, reports that in December 2014, a value of liabilities used in OTC tri-party repo transactions with the Bank of Russia reached its highest level and exceeded RUB2 trillion1 in Q4 2014. In January 2014, the value of liabilities amounted to RUB1.1 trillion2. These statistics indicate that the NSD tri-party services are in demand among the market participants involved in the Bank of Russia’s repo transactions.
Maria Ivanova, Vice President, Director for Development and Client Relations, NSD, commented on the event: “Development of tri-party services is a global trend in the post trading sector. In recent years, a share of tri-party services in the structure of settlement infrastructures’ income has risen sharply; now it is a growth driver. We see the similar trend in the Russian market. In addition to the Bank of Russia’s repos with securities basket, we are ready to launch the similar service for transactions with the Federal Treasury. We also plan to launch on-exchange repos with the NSD’s tri-party services.”
Since the moment of the launch in April 2013, the service of the Bank of Russia’s repos with securities basket demonstrates a stable positive dynamics. 2014 was also a dynamic year: the value of liabilities doubled and reached RUB2 trillion. Not just the value of liabilities reached its highest level; the value of OTC repo transactions serviced by NSD also peaked, exceeding RUB54 trillion3. The value of transactions for Q4 2014 50% increased Y-o-Y – from RUB12 trillion to RUB18.5 trillion4. The total value of direct repo transactions with the Bank of Russia since the beginning of 2014 stood at RUB95.5 trillion.
NSD also plans to provide its clients an access to Euroclear’s and Clearstream’s securities lending programs that enable to broaden foreign asset management opportunities for Russian market participants. The company works on the projects related repo transactions with a share in securities pool together with the Moscow Exchange and NCC. NSD also intends to integrate its collateral management services in the market of standardized derivatives jointly with the Moscow Exchange and to develop interdealer repos with securities basket and collateral management provided by NSD.
1 As of 19 December 2014
2 As of 31 January 2014
3 Total value for the period from 1 January 2014 to 19 December 2014
4 As of 19 December 2014