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Clearstream Goes Live with DVP Settlement Link in Russia

NSD Chairman Eddie Astanin said the link will create additional opportunities for foreign investors who conduct transactions with Russian fixed income instruments.
By Janet Du Chenne(59204)
Clearstream has gone live with its delivery versus payment link with the Russian CSD, the National Securities Depository.

The link comes amidst reform in Russia’s capital markets and offers more real time settlement compared to the free of payment (FOP) and the current settling in cash batches. For DVP settlement, a clear link is established between a securities transfer system and a funds transfer system that ensures delivery occurs only as and when payment occurs.

The extent to which real-time securities settlement becomes a real possibility will still depend on the decision by Russian market participants to move away from the batch system
for local cash transfers.

Clearstream has also introduced Russian municipal and regional bonds
for settlement via the NSD and extends settlement deadlines for its free of payment(FOP) settlement service by several hours (from 13:55 to 17:20 CET summer time). As a next milestone, Clearstream plans to introduce settlement for Russian corporate bonds and to enhance its access model for Russian equities as soon as local legislation allows for this.

Jeffrey Tessler, CEO of Clearstream, said: “Our new delivery versus payment settlement solution is an exciting milestone as it helps pave the way for the Russian market to move to more towards a real time settlement environment, keeping up with other capital markets around the world as part of Russia’s capital market reform.”

Eddie Astanin, chairman of the Executive Board, NSD, commented: “Switching to delivery versus payment (DVP) using the link between the National Settlement Depository and Clearstream will create additional opportunities for foreign investors who conduct transactions with Russian fixed income instruments. We are happy to see a high rate of technological development of Clearstream’s link, which in turn is contributing to the development of the national infrastructure and, as a consequence, makes the Russian financial market more attractive and competitive.”

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