OREANDA-NEWS.   Euroclear Bank’s post-trade services for RussianOFZs, one of the most actively traded classes of Russian government bonds, will commence on 7 February 2013.  Via Euroclear Bank’s account with Russia’s central securities depository – National Settlement Depository (NSD) – all of the major international firms trading OFZs will be able to settle those trades and deposit their OFZ positions with Euroclear Bank. All Russian regulatory and operational clarifications have been received.

The service will begin with OTC-traded OFZ transactions, followed by stock exchange-traded transactions in March 2013. The Euroclear Bank/NSD link will also enable clients of each depository to settle cross-border transactions easily.

Frederic Hannequart, Chairman of Euroclear Bank, said: “The 7 February milestone will mark a new era in the ability of Russia to fund its growth and development through the international capital markets. Industry experts are predicting new foreign capital inflows to Russia in the region of USD 20 billion (RUB 615 billion). Euroclear Bank is proud to become part of the new Russian Financial Center by making OFZs eligible for Euroclear services.”

Hannequart continued: “I wish to extend a special thank you to our colleagues at the National Settlement Depository who have been extremely helpful in responding to international capital market demands for the Euroclear Bank service.”

Eddie Astanin, Chief Executive Officer of the National Settlement Depository, commented: “We have worked with colleagues at the Bank of Russia, Russia’s Federal Financial Markets Service and the Russian Ministry of Finance to make the necessary legislative changes that will greatly enhance the appeal of Russian Federal bonds.  Together with Euroclear Bank, NSD is offering the Government of Russia a broader, cheaper and more efficient way to fund the country’s growth through the bond markets. A tremendous amount of work has been done to accelerate the process of fulfilling the necessary requirements for an effective cross-border service for OFZs.  I am delighted that February 2013 will be remembered as the point when Russia opened its capital market to the world.”

Euroclear Bank’s service for OFZs traded OTC is the first of a progressive suite of services that will cover exchange-traded OFZs and other Russian fixed-income securities (corporate and municipal bonds) in the coming months. 

OFZs held in safekeeping by Euroclear Bank will also be eligible as securities collateral for securitised transactions where Euroclear Bank is the triparty collateral management agent.

Upon launch of the link with NSD, Euroclear Bank will have links with CSDs in 45 major countries. The Russian rouble is already one of 54 settlement currencies in Euroclear Bank.

NSD has links with CSDs/ICSDs in seven countries.