Polish CSD plans OTC clearing launch, corporate actions application

Krajowy Depozyt Papierów Wartosciowych, Poland’s national securities depository, has prioritsed for 2012 the implementation of OTC derivatives clearing.
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Krajowy Depozyt Papierów Wartosciowych (KDPW), Poland’s national securities depository, has prioritsed for 2012 the implementation of OTC derivatives clearing. The project follows the launch of KDPW_CCP clearing house, which developed the OTC clearing model, in July 2011.

“The main benefit of the project is to release credit limits, which banks impose on their counterparties. This in turn may improve liquidity on the interbank market, which is so much needed these days,” said Iwona Sroka, president and CEO of KDPW. The central securities depository (CSD) will also adopt SWIFT’s Accord for Treasury for matching these transactions.

KDPW said the creation of a separate clearing house in 2011 was a major step forward for the Polish capital markets. “As a result, the Polish market complies with global standards of clearing houses and central securities depositories,” it said in a press release. “These are projects key to the development of the Polish capital markets.”

Among other plans for 2012, KDPW is finalising work on an application which will allow issuers of securities to exchange corporate actions information over a website. The modifications will be implemented in the first quarter of this year. “Information on upcoming payments of benefits required under applicable regulations, which issuers previously provided to the national depository in paper form, will now be entered by issuers solely via the internet application,” it said.

Other active projects crucial to the Polish market include the creation of a securities loans platform and implementation of the hold-release mechanism necessary to steer the sending of instructions for clearing according to international recommendations in order to reduce the cost of settlement.

The KDPW also successfully migrated euro settlement to the European Central Bank’s TARGET2 on 21 November 2011. First operations have already been performed on the platform.

Nasdaq OMX buys Lithuanian CSD

Meanwhile, Nasdaq OMX Group, which operates exchanges in the Nordic and Baltic regions, has acquired the remaining 60% of shares in the Central Securities Depository of Lithuania (CSDL) that it does not own via its Finnish bourse.

Prior to the acquisition, the market operator owned 32% of CSDL via Nasdaq OMX Helsinki and 8% of the CSD via Nasdaq OMX Vilnius, the Lithuanian exchange of which Nasdaq owns 96%.

“Acquiring the remaining stake in the Central Securities Depository of Lithuania was a natural step in providing an integrated and cost efficient offer of high quality trading and post-trading services to companies traded on Baltic exchanges and investors trading in Baltic countries.” said Hans-Ole Jochumsen, president of Nasdaq OMX Nordic.

Reporting by: Janet Du Chenne, Global Custodian, an Asset International publication; and Anish Puaar