OREANDA-NEWS.  On 15 April, National Settlement Depository (NSD), Russia’s central securities depository, launched a new service related to the Bank of Russia’s off-exchange tri-party repo transactions with a basket of securities with collateral management, clearing and settlements. During the first day of the new system’s operations, the Bank of Russia has concluded 11 transactions with ING Commercial Banking, JSCB N.A.B., CB RIAL-CREDIT (Ltd.) and JSCB DERZHAVA; NSD has selected collateral and conducted settlements on these transactions.

The transactions are conducted for the participants who have concluded with the Bank of Russia general agreements on repo transactions in Russia’s OTC market using Bloomberg system. In respect of repo transactions, NSD is responsible for selection of collateral and collateral management.

The collateral management system developed by NSD will contribute to improved liquidity of the market and reduced expenses of the market participants during concluding repo transactions with the Bank of Russia. The new technology will allow to select the optimal collateral for repo transactions, to replace securities, to automatically replace collaterals prior to corporate actions, and to hold margining on the pool of all transactions. The collateral management system has been developed on the basis of the experience of other international settlement and clearing organizations; it does not have analogues in Russian market.

Previously NSD’s Supervisory Board has established tariffs for clearing operations and collateral management. The Management Board of the company has set a promotional period for these operations until 1 June 2013; during the period, the tariffs are reduced by 50%.

The settlements are to be held in three clearing sessions and to allow partially execution of the first part of the repo transaction.