Participant Meeting 23.10.2018 Agenda Business facts & figures - PowerPoint PPT Presentation

OeKB CSD Participant Meeting 23.10.2018

Agenda  Business facts & figures  Authorisation to act as CSD under CSDR  T2S/SWIFT release  Backup procedure: Instructions in case of disruption of the SWIFT connection in ICP- mode  Austrian bearer shares on MTFs  Developments in the BMF FinTech advisory board relevant for OeKB CSD  AOB 23.10.2018 2

Business Facts & Figures

Business Facts & Figures: as of 30.09.2018 Safekeeping 31.12.2017 31.01.2018 28.02.2018 31.03.2018 30.04.2018 31.05.2018 30.06.2018 31.07.2018 31.08.2018 30.09.2018 Issuer CSD 312,985 307,880 308,737 308,613 309,127 310,609 312,099 313,345 313,591 314,825 Securities with Nominal Value in Euro million Investor CSD 15,508 14,791 13,821 13,866 14,243 14,224 14,141 13,632 13,431 13,718 Market Value in Issuer CSD 282,231 289,284 283,914 281,241 294,983 299,912 294,518 302,940 297,549 298,839 Euro million Investor CSD 3,275 2,819 2,662 2,622 2,581 2,308 2,185 2,189 2,165 2,120 Unit-listed securities Issuer CSD 8,908 8,851 8,807 8,743 8,856 8,755 7,856 7,915 7,900 7,895 Units in million Investor CSD 420 411 403 402 402 387 394 397 396 397 Issuer CSD 14,510 14,998 15,061 14,372 14,875 15,021 14,078 14,467 15,021 14,763 Number of securities categories Investor CSD 1,414 1,454 1,477 1,486 1,511 1,375 1,391 1,367 1,372 1,364 Account Holders 31.12.2017 31.01.2018 28.02.2018 31.03.2018 30.04.2018 31.05.2018 30.06.2018 31.07.2018 31.08.2018 30.09.2018 Domestic 56 56 55 54 54 54 54 54 53 53 Number of Account Holders Non-domestic 23 23 23 23 23 23 23 23 23 24 Settlement ØM 2018 01/ 2018 02/ 2018 03/ 2018 04/ 2018 05/ 2018 06/ 2018 07/ 2018 08/ 2018 09/2018 ∑ 01-09/ 2018 Intra 104,488 115,757 108,589 109,934 99,355 99,945 108,294 103,243 100,555 94,719 940,391 Number of Transactions Cross/External 2,904 3,446 2,531 2,344 2,279 2,840 3,012 3,499 3,351 2,834 26,136 23.10.2018 4

Authorisation to act as CSD under CSDR

Authorisation to act as CSD under CSDR (1/2)  OeKB CSD was granted the licence as CSD and the licence for the provision of banking-type ancillary services according to EU Regulation ((EU) No. 909/2014 ("CSDR")) on 01.08.2018 by the Financial Market Authority (FMA).  This confirms compliance with the comprehensive regulatory requirements governing the organisation of CSDs in the EU and is a prerequisite for OeKB CSD to continue providing its core services to the Austrian capital market. 23.10.2018 13

Authorisation to act as CSD under CSDR (2/2)  The license comprises the following services: The 3 CSDR core services:   Initial recording of securities in a book-entry system (notary service). Under this function we accept securities in order to hold and administer them as Issuer CSD.  Providing and maintaining securities accounts at the top tier level (central maintenance service). Under this function we maintain securities accounts for credit institutions, investment firms, central securities depositories, central counterparties and special institutions. Operating a securities settlement system (settlement service). Under this function we process instructions (booking  orders) placed by securities account and cash account holders. In this context, we are a system as defined by Section 2 para. 2 of the Austrian Finality Act (Finalitätsgesetz).  Non-banking-type ancillary service:  Processing of corporate actions, including tax, general meetings.  Collection of income for securities due. Banking-type ancillary service:  Administration of cash accounts in Euro and common currencies on behalf of our clients.  The purpose of the cash accounts is limited to our activities as a CSD.  23.10.2018 7

T2S/SWIFT Release

Eurosystem T2S Releases in 2018 DKK Migration* Q1 2018 Q2 2018 Q3 2018 Q4 2018 Problem Release Major Release Problem Release Minor Release Start of Release Deployment to PROD: PROD: PROD: PROD: 17/02/2018 08/06/2018 15/09/2018 17/11/2018 Last discussed Development and Development and Development and deployment: deployment: deployment: scope: 22 PBs 18CRs + 53PBs 26 PBs 6 Problem Tickets * T2S introduces a new settlement currency „Danish Kroner (DKK)“ on the platform. The migration weekend starts on Friday, Oct. 26 th , 2018 at 06:45 p.m. and 23.10.2018 13 ends on Saturday, Oct. 27 th , 2018 according to the latest planning.

SWIFT Standards MT Release 2018 (1/2)  The change of the SWIFT test environment to the new message syntax table 2018 (Future Mode) was on Monday, September 24 th , 2018.  Our SWIFT communication channels will be closed:  from Saturday, November 17 th , 2018 from 04:00 p.m.  to Sunday, November 18 th , 2018 until 02:00 p.m. During this time, we will not be able to accept any instructions. All instructions will be queued.  SWIFT users will need to update their system to receive the updated message formats, qualifiers and values. 23.10.2018 10

SWIFT Standards MT Release 2018 (2/2) Details on the changes (only for settlement instructions) New codes SWIF and SWIT:  MT540-MT543: If the new codes SWIF or SWIT are used in field :22F::SETR (sequence e-settlement details), the codes will be accepted but the instruction will be sent as TRAD to T2S and will be resent as TRAD as well.  The new codes will also not be reported in MT548 messages. New qualifier RSCH:  The new qualifier RSCH for field :19A: will be accepted but disregarded for processing.  The new qualifier will also not be reported in MT544-547 messages. For further information, please refer to Annex 18 ‘User Manual Settlement SWIFT ISO 15022 ’ 23.10.2018 11

Backup Procedure: Instructions in Case of Disruption of the SWIFT Connection in ICP-Mode

Backup Procedure: Instructions in Case of Disruption of the SWIFT Connection in ICP-Mode (1/3) 23.10.2018 13

Backup Procedure: Instructions in Case of Disruption of the SWIFT Connection in ICP-Mode (2/3) Methods for Issuing Instructions for Booking of Securities: 23.10.2018

Backup Procedure: Instructions in Case of Disruption of the SWIFT Connection in ICP-Mode (3/3)  Contractual condition “Agreement on the use of the Filebox ” between OeKB CSD and the securities account holder. Please refer to GTC, section 5.2 (4) – update available soon.  Procedure and requirements Please refer to “ Agreement on the use of the Filebox ”.  Pricing Flat fee for the provision of the Filebox: 500 EUR for each calendar year.  Testing possibilities 23.10.2018 15

Austrian Bearer Shares on MTFs

Austrian Bearer Shares on MTFs (1/6) History: The Bearer Share had been by far the dominant type of share when it came to stocks traded on any  market segment (either the top-tier-segment or market segments with less strict rules like Multilateral Trading Facilities). The Registered Share on the other hand was traditionally frequently used by issuers with a very limited number of shareholders, mostly „ Familien-Aktiengesellschaften “. The FATF (Financial Action Task Force [on Money Laundering]), founded 1989 in Paris, in the meantime  gained importance and weight and issued about 40 so called “ recommendations ” (Soft Law). The FATF also issues lists of NCCT-countries ( non-cooperative countries and territories ).  After the Lehmann-crisis authorities became generally more concerned and increasingly reacted to the threat of money laundering and terrorism financing. „ Bearer Shares“ started to be seen as problematic.  In order to avoid being put on any list other than „white“ (grey, dark -grey or black) by the FATF, the Austrian government reacted. 23.10.2018 17

Austrian Bearer Shares on MTFs (2/6)  The GesRÄG 2011 (Gesellschaftsänderungsgesetz 2011) stipulated that the Registered Share is the rule . Exceptions form the rule would only be accepted for those shares whose issuers are listed on a „ regulated market “ (Note: we are only speaking of shares issued by Austrian issuers!) The term „regulated market“ was defined by § 3 AktG and currently is only applicable to the top-  segments of the Austrian Stock Exchange – not the so-called Third Market , a MTF (Multilateral Trading Facility) – which was originally designed as an entry-segment to the capital market . The law foresaw some exceptions for issuers who were already using the Third Market, but the outcome  was very harsh regarding the accessability of the Austrian capital market - as seen from the perspective of companies who wanted to grow or who had to grow in order to finance R&D or needed new equity or to access export markets. 23.10.2018 18