FORTS Introduces Changes to Delivery of Futures on Securities
OREANDA-NEWS. December 7, 2007. Starting from December 17th, 2007, on FORTS, the procedure of delivery of futures contracts on securities with settlements through NP RTS will change, RTS' press service reports. These changes are caused by the necessity to increase guarantees for delivery settlements by prolonging the time period during which delivery participants can fulfill their obligations.
The new procedure of delivery is supposed to perform delivery of futures contracts in two stages:
First stage – from 10.00 till 10.30 of the settlement day: contracts are settled basing on the availability of assets on delivery participants’ accounts;
Second stage – from 15.00 till 15.30 of the settlement day: the contracts, not executed in the first stage, are settled
The first stage of delivery is similar to the procedure of delivery before introduction of changes: Clearing centre checks the possibility of settlement of contracts judging from the size of assets, transferred to delivery registers. Cash funds and securities assigned for settlement on delivery in positions, not executed on the first stage, remain reserved for the second stage. At the same time, funds of initial margin for positions ensured by assets are released.
Moreover, there appears an additional opportunity to release initial margin for positions, liable to delivery on the second stage, if a Clearing member transfers assets to delivery registers of trading cash account and trading depository account by 12:50.
During the second stage of delivery the Clearing centre receives information on the size of assets, transferred for delivery and performs settlement of contracts, not executed on the first stage.
For improper settlement and execution of contracts a Clearing member is fined in the following way:
For improper fulfillment of obligations during the first stage of delivery the fine of 0,5 per cent of the size of delivery obligations is implied;
For non-execution of obligations during the second stage the fine in the size of initial margin for non-executed contracts is implied.
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