Raiffeisen Bank International (RBI) has become the first foreign custodian bank to establish a direct link with the Russian securities market.
The Vienna-based custodian established connectivity by opening a foreign nominee securities account direct with the National Settlement Depository (NSD), Russia’s central securities depository (CSD).
RBI can now provide its clients with access to a range of Russian financial instruments and NSD services.
“Establishing a direct link with the Russian central securities depository will expand the range of market access options which we provide our clients with and will contribute to the inflow of capital to the Russian securities market,” said Attila Szalay Berzeviczy, head of group securities services, RBI.
The direct connectivity follows a relaxation in Russian laws regulating its securities markets and set out the terms for international financial infrastructure participants gaining access to the Russian market.
Previously, only international and other countries’ CSDs had been allowed to open a foreign nominee securities account with the NSD, requiring foreign banks and custodians to seek other ways to access NSD services.
“An opportunity for foreign companies to open foreign nominee accounts with NSD means diversification of channels through which foreign investors can access the Russian market. We believe that such a model will add value to clients of Raiffeisen Bank International who are interested in making transactions in the Russian market”, added Eddie Astanin, chairman of NSD’s executive board.
The connectivity is the latest effort by RBI as it looks to establish itself as a gateway to Eastern European market infrastructures.
Last year, the bank established a post-trade settlement partnership with SEE Link, the joint trading platform of seven South Eastern European stock exchanges. RBI’s Group Securities Services (GSS) Operations Centre would act as settlement agent for the trades executed on SEE Link, in order to overcome certain asset servicing challenges caused by differing currencies and legal structures across the participating countries.