Russia Establishes Central Securities Depository (CSD)
Moscow, 6 November 2012 – Moscow Exchange Group is pleased to announce that the Russian financial markets regulator Federal Financial Markets Service has today granted the Group's subsidiary National Settlement Depository (NSD) status as the country's Central Securities Depository (CSD). The establishment of a CSD is a landmark development in the Russian capital markets and will increase transparency in respect of securities ownership, improve efficiency, and give international investors easier access to Russian securities.
Over time, the CSD is expected to enhance liquidity and lower settlement costs, while ensuring that all market participants operate on the same post-trading platform.
Foreign central depositories will now be able to open nominee accounts with Russia's CSD. Federal, sub-federal, municipal and corporate bonds of Russian issuers will be covered by the links with International Central Securities Depositories (ICSDs) by the end of 2012. Furthermore, NSD is expected to meet the requirements of Rule 17f-7 of the United States Investment Company Act of 1940, allowing US funds to invest directly in Russian securities.
NSD is the depository of MICEX, the Russian exchange that completed a merger with peer exchange RTS in December 2011, creating Moscow Exchange Group. Over the course of this year, NSD has merged the operations of RTS's legacy depository, DCC, into its own.
Alexander Afanasiev, Chief Executive Officer of Moscow Exchange Group, commented:
“The establishment of the CSD is a milestone event for Russia’s financial markets. It is one of the key elements of guaranteeing rights of both Russian and international market participants and providing comfort to all categories of investors given it is in line with international best practices. The creation of a CSD is one the most important reforms the Moscow Exchange is executing in partnership with market participants, regulators and legislators. Other key reforms include changes to the listing rules, the introduction of settlement in T+n and creating a single family of indexes. These are the necessary elements of a modern, competitive exchange infrastructure and their implementation make the entire Russian financial market more attractive.”
Eddie Astanin, Chairman of the NSD Executive Board, said:
"Throughout 2012 the NSD team has worked hard to make way for today’s event by uniting the Russian settlement infrastructure under the NSD brand, building a strong team of professionals, and introducing changes to the regulatory, technological, and operational aspects of our business. We thank our shareholders, Supervisory Board and clients for their strong support."