TAKASBANK. ISE Settlement and Custody Bank Inc. Emin CATANA President & CEO

Transcription

1 ISE Settlement and Custody Bank Inc. Emin CATANA President & CEO 1

2 Global Trends Deregulation Advanced technology and continuosly developing communications facilities Economical and political approaches Cross-border movement of capital and funds * Disappereance of geographical borders * Continuous & considerable amount of investment need in technology * Increase or decrease in competitiveness. * Economic and political integrations * Single currency (euro) * Increased competition to stay around or to merge in favorable terms and conditions. Increased cross-border securities trading * New electronic marketplaces (ECNs, ATNs, etc..) * Trading through internet Increased Risks

3 Global Trends (continued) Increased legal risks Increased operational risks Division of liquidity High competition Increased funding and collateral costs IOSCO studies Cooperations and mergers among stock exchanges and CSDs. ISSA G30s recommendations Need for full automation and STP Delivery versus Payment DVP Shortening of the settlement periods Central collateral management and netting --> Central Counterparty (CPP)

4 A Most Promising Clearing and Settlement System 1. Full automation and STP (with international standards) 2. Delivery versus Payment - DVP 3. Well founded, clear, transperant legal basis 4. Well designed governance balancing the interests of the public, shareholders and users. 5. Well managed operational risk, contingency systems, stand-by disaster recovery systems 6. Protection of customer assets 7. Securities Lending Borrowing 8. Efficient cross-border settlement links 9. Evaluation of the set up of a Central Counterparty 4

5 Turkey among Emerging Markets Source:GSCS Bechmarks 2002 Review 5

6 Turkey among Emerging Markets Source:GSCS Bechmarks 2002 Review 6

7 Unique Functions of Takasbank in Turkey Central Securities Depository of Turkey Clearing and Settlement Institution for the Istanbul Stock Exchange (ISE) Money Market for ISE Members Official Custodian for Pension and Mutual Funds National Numbering Agency of Turkey 7

8 Bridge Role in The Turkish Financial Markets Capital Markets Board Capital Markets Intermediaries Istanbul Stock Exchange Central Registry Institution Issuers indirect Investors Banking Regulation and Supervision Board Banks Central Bank of Turkey 8

9 Securities are in physical and bearer form Customer Name Based Custody Interactive voice response system - Alo Takas and Internet Service - TakasNet Custody at a glance For improved transperancy for the investors. Cross-check facility for their holdings Investors are able put blockage on their assets. Dematerialization process (to start) Central Registry Institution Registration Investor Protection Fund Progressive and Administrative Liquidation 9

10 Custody System with Numbers Equities Bonds & Bills Pension and Mutual Funds Portfolios Asset Value under Custody ( ) USD (Billion.) Total number of investor sub-accounts (equities) 2,150,000 10

11 Clearing and Settlement Organized Market Clearing and Settlement for the ISE Multilateral netting for broker settlement Takasbank is the central counterparty (without settlement guarantee) Default procedure exists DvP Settlement - RTGS Broker to Custodian Settlements Takasbank is not the Central Counterparty No default procedure 11

12 Organized Market Clearing and Settlement with Numbers (Equities) Number of Stock Exchange Members : 115 Number of Companies Traded : 288 Average Daily Trading Volume : USD 728 million Average Daily Number Contracts : 183,000 Cash Settlement (after netting) : %15 Securities Settlement (after netting) : %30 *Daily Average Values are of January-April

13 Credits Services Securities Lending and Borrowing Intermediary Role for Takasbank Guaranteed by Takasbank Takasbank Money Market Intermediary Role for Takasbank Guaranteed by Takasbank Cash Credits All credits services are fully collateralized by Takasbank Increased settlement efficieny 13

14 Operational Efficiency Off-site Disaster Recovery System with an operations center. All operational program products are delevoped in house All members are online connected to Takasbank system and using our proprietary program products. The Takasbank Electronic Transfer System (TETS) enables brokerage houses to transfer both securities (G- Bonds&T-Bills) and cash in and out of the Takasbank system electronically in real-time connection with the Central Bank's EFT system. Real-time connection to Istanbul Stock Exchange, Central Bank of Turkey and Capital Markets Board. 14

15 Cross-Border Settlement and Custody Services Settlement and custody service on foreign securities for domestic financial institutions via Euroclear Domestic settlement and custody service for foreign financial institutions SWIFT Membership Foreign exchange correspondant accounts 15

16 International Standards for Securities ISO TC68-SC4 Membership on behalf of TSE Convenor of the National Market Practice Group-Turkey National Numbering Agency of Turkey responsible for assigning ISIN (International Securities Identification Number) for securities issued in Turkey. Member of Association of National Numbering Agencies (ANNA), Member of the ANNA Service Bureau Advisory Board, Convenor of ISIN Review Task Force, Convenor of the "Emerging ANNA Members" Working Group. Since Feb. 2000, G-Bonds & T-Bills have been identified by ISIN codes; ISIN is planned to be used as primary key for equities. 16

17 Ongoing and Future Projects Dematerialization Central Registry Institution (September 2001) Dematerialization is planned to start by mid 2004 and to be finalized by Clearing and Settlement of Exchange Traded Funds. Implementation ISIN as unique identifier for equities Electronic Securities Database Planned to be the Clearing House for the Futures and Options Exchange in Izmir 17

18 THANK YOU 18