Thomas Murray has upgraded the CSD rating for Russias National Settlement Depository (NSD) to AA-, which translates as very low overall risk. Its previous rating was A+.
Thomas Murray noted a number of factors that led to the upgrade, including that: asset servicing risk exposure is low; NSDs capital of around $180 million appears to be adequate for a depository that has a restricted banking license to provide cash settlement services; it has made improvements in a number of risk factors, including audit arrangements, the internal control department, external operational audits and a dedicated Risk Management Department; improved disaster recovery and business continuity arrangements; improved governance and transparency arrangements; and enhanced asset safety resulting from improved legal conventions.
Thomas Murray has carried out an independent CSD public rating on NSDs operations following a momentous year, says Simon Thomas, CEO and chief ratings officer of Thomas Murray. NSD was impacted by the merger of the exchanges, MICEX (its majority owner) and RTS, changes to a number of securities market laws and being granted a license to operate as a CSD by the market regulators. The rating has upgraded the CSD risk rating on the back of improved arrangements to manage operational risk. Going forward NSD will need to continue to make improvements, especially in the area of asset servicing, if it wishes to maintain or improve on its AA- rating.
Eddie Astanin, CEO of NSD, adds: Risk management continues to be a major focus of attention for NSDs Supervisory Board and Executive Board. We recognized its importance given the extent of change that we have had to manage in the past year. Our efforts have been suitably recognized by the upgrade to our rating and we intend to push ahead in making improvements in areas where weaknesses have been identified. The Thomas Murray rating assessment will help us to identify those areas of our operations that can be further improved and provide Russia with a world class clearing and settlement infrastructure.
Thomas Murray maintains proprietary assessments of more than 130 CSDs globally.
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