BNY Mellon has reached an agreement with Russia’s National Settlement Depositary (NSD) to enable Russian investors and brokers to issue and cancel depositary receipts (DRs).
The deal with NSD, which is owned by Moscow Exchange Group, will mean DRs issued by BNY Mellon on shares in Russian companies can be converted into a share and vice versa.
BNY said the deal will speed up the process from two to three business days to one.
This will enable DRs to trade on the secondary market, settle and be used as collateral for repos.
“This is a revolutionary solution for the capital markets because it’s the first time a DR will trade on its local market”, explained Christopher Kearns, CEO of BNY Mellon's Depositary Receipts business.
“DR’s trading in multiple markets at the same time is also a relatively new concept. This is another step towards the idea of a global security which allows investors to transcend geographical borders.”
Eddie Astanin, chairman of the executive board of NSD, said: “We expect to see increased interest from global investors working with depository receipts in the Russian securities market.”
BNY Mellon will act as custodian for NSD and depositary bank for DRs trading on the Russian market.