National Settlement Depository Reports Q3 2015 Results
The number of book-entry transactions at the CSD in Q3 2015 slightly decreased – from 632 thousand in Q3 2014 to 609 thousand in Q3 2015 (-3.7%).
In Q3 2015, the number of stock exchange transactions remained practically unchanged – 490.2 thousand in Q3 2015 against 496 thousand in Q3 2014; the number of OTC transactions amounted to 118.3 thousand – this was 13% less than in the same period of the previous year (135.7 thousand operations). In Q3 2015, the value of OTC DVP transactions* increased considerably and reached RUB 585.4 billion; this was 17.5% more than in Q3 2014.
The Collateral Management System
The service of collateral management used to conduct repo transactions with the Federal Treasury, which had been launched in Q2 2015, showed great dynamics in Q3 2015. Only in the third quarter, the value of repo transactions with the Federal Treasury amounted to RUB 4.6 trillion. For reference, in the same period, the value of repo transactions with the Bank of Russia conducted with the use of the NSD collateral management servives reached RUB 8.1 trillion. Therefore, the value of repo transactions with the Federal Treasury represented more than a third of the value of all repo transactions conducted with the use of the NSD collateral management services; this suggests the market participants’ high demand for the new service.
The value of repo transactions with the Bank of Russia conducted with the use of the NSD collateral management services decreased from RUB 11.6 trillion in Q3 2014 to RUB 8.1 trillion in Q3 2015. Meanwhile, in Q3 2015, the number of repo transactions with the Bank of Russia conducted with the use of the NSD collateral management service increased YoY from 1,879 to 2,284 (+21.6%).
In total, the value of transactions conducted with the use of the NSD collateral management stood at RUB 12.7 trillion; this was 11% more than in Q3 2014 (RUB 11.6 trillion).
Prior to the introduction of mandatory reports on all types of derivatives from 1 October 2015, the NSD Repository’s operational indicators showed growth in Q3 2015:
- The number of clients reached 1,178 (1,078 in Q3 2014);
- The number of registered transactions grew 44.5% to 107.8 thousand (74.6 thousand in Q3 2014);
- The value of registered transactions grew more than 60% to RUB 105.3 trillion (RUB 64.2 trillion in Q3 2014).
In addition, market participants continued to voluntarily submit reports on transactions which were non-mandatory until 1 October. In Q3 2015, the most intensive reporting was observed on currency forwards (more than 61 thousand transactions were registered) and currency swaps (37.6 thousand transactions).
In Q3 2015, the currency swaps value was the highest and amounted to RUB 77.1 trillion; the value of OTC repo transactions stood at RUB 17.2 trillion. The participants also submit reports on currency and commodity options, securities options, commodity forwards, etc.
The Corporate Actions Center
Issuers and market participants continue switching to new electronic technologies used at shareholder meetings. In Q3 2015, 138 meetings were held with the use of the e-proxy voting technology available in the format developed by NSD and in ISO formats. In January-September 2015, 972 shareholder meetings were conducted in Russia with the use of the e-proxy voting technology.
From 1 April, Russian issuers can use the e-proxy voting technology based on ISO 20022. In Q3 2015, 25 shareholder meetings were conducted with the use of the e-proxy voting technology based on ISO 20022.
In Q3 2015, NSD introduced new possibilities in the field of work with corporate information. In particular, users of NSD products were able to receive information on corporate actions with Russian issuers’ shares, including conversion, consolidation and repurchase. The possibility of receiving information on corporate actions with Russian issuers’ bonds associated with coupon payment and repayment was expanded. In addition, NSD implemented a user-friendly function to fill the form “Report on securities” (code 0409711 in accordance with the All-Russian Classifier of Management Documentation) approved by the Bank of Russia’s Instruction №2332-U on 12 November 2009.
The company introduced two new reports: the “Admission to Trading” Report containing information on securities’ admission to trading on the Moscow Exchange, changed listing level, suspended, resumed and stopped trading; and the Report on Change in Data on Foreign Securities and Their International Codes containing information on changes in/updates of foreign financial instruments’ international codes.
As part of the promotional period, NSD offered the clients of the Moscow Exchange, Interfax, Cbonds and Thomson Reuters an opportunity to use fair value data on more than 1,400 financial instruments calculated by the Valuation Center.
Payment system and cash settlements
In Q3 2015, the value of money transfers made upon instructions of NSD’s clients increased 22% YoY and reached RUB 89.7 trillion (compared with RUB 73.6 trillion in Q3 2014). The NSD Payment System has a stable position among the largest payment systems in Russia.
National Numbering Agency and Local Operating Unit (LOU)
NSD acts as Russia’s Numbering Agency and the substitute numbering agency for the CIS, 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.
Russian market participants continue to receive pre-LEIs that must be used by all professional securities market participants submitting reports to a repository in compliance with the Bank of Russia’s requirements put into effect on 1 July 2015. In Q3 2015, NSD assigned 106 pre-LEIs; this was 3.2 times more than in Q3 2014 (33 codes). 3 pre-LEIs were received for servicing from the pre-LOU based in the United States.
In Q3 2015, NSD assigned 285 ISINs and CFIs to Russian financial instruments. This was almost 70% more than in Q3 2014. As a substitute numbering agency, NSD assigned 26 ISINs and CFIs in Q3 2015.