SAINT-PETERSBURG EXCHANGE REPOSITORY Andrey Salaschenko, - - PowerPoint PPT Presentation

SAINT-PETERSBURG EXCHANGE REPOSITORY

29/11/2013 European Bank for Reconstruction and Development (EBRD)

Andrey Salaschenko, Vice-President RTS NP

NP RTS – INTEGRATOR OF RUSSIAN FINANCIAL MARKET

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Support for the creation of new services and products to increase customer activity 115 members – main decision- makers of the market Reducing costs and improving the efficiency of the participants in the financial markets

We accumulate ideas, needs and resources of financial markets in Russia and implement projects aimed at their development. We create new products, technologies and

• pportunities.

Group RTS:

Saint-Petersburg Exchange Repository NONPROFIT PARTNERSHIP

NP RTS: DESTINED TO CREATE REPOSITORY

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Experienced in relevant technology

2001-2013: creation of platform for Moscow Exchange (previously RTS Stock Exchange) organized derivatives market (leading market through all the years, up to 99%+ of the whole organized derivatives market in Russia); 2006: creation of platform for OTC reporting of Spot securities trades (covered around 99% of overall reporting in 2007-2013); 2010-2011: creation of platform for state procurement including web-services, data storage and encryption issues (18% of Russia state procurement uses that technology*). We are the team that created organized derivatives market in Russia (FORTS market, currently operated by Moscow Exchange); We are in partnership with team that created Russian ISDA Master Agreement Regulations. Stored data on around 400 000 electronic auctions*: no cases of information leakages; More than 350 000 organizations including state and municipal authorities trusting their information to our group*; Own certifying center (creating electronic digital signatures).

Experienced in derivative products Experienced in information security

* As of 1/10/2013, source - http://zakupki.gov.ru/

NP RTS: REPLYING TO DEMAND

04 Saint-Petersburg Exchange Repository

Fair pricing of repository services in Russia; Costs saving in connection to repositories; Flexible solutions for different categories of market participants; Flexible legal repository framework; Back-up repository for banks and other participants preferring “state” repository as a primary option. Creating repository as a reply to the demand for:

IT SOLUTIONS

WEB-Service WEB Interface – free of charge, bilingual File Bridge – free of charge, developed for connection via WEB-Service, bilingual FLEX (FpML Exchange) – free of charge, bilingual SWIFT File act – is being launched by the end of December 2013 in the full operating mode Hard copies

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Crypto keys suitable for all categories of market participants: Qualified digital signature; Encryption provider Microsoft CSP; Advanced nonqualified certificate (RSA). Two models of interaction: statuses of reports available on request and callback mechanism. As the main format of interaction is used a limited subset of the FpML format (v. 5.4). We are committed to a common format for all Russian repositories.

Saint-Petersburg Exchange Repository

Connectivity: Key pillars:

FORMATS OF INTERACTION

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System software relates to the WEB-services of Repository and implements the full functionality of interaction. The system can generate the necessary reports in FpML format and analyze the response messages, but the transport functions and control of EDS are operated by a separate software. The system is source of visual data only. Message generation and interaction with the Repository is performed by a separate software. Set-up process takes*:

2 weeks 7 days 20 min

* Taking into account work of a small group of 3 – 4 employees

Full integration Partial integration Minimal integration

PREPARED SOLUTIONS

Worked out for the interaction with the Repository by file-sharing, the gateway will save a customer from having system-level elaboration. Its bilingualism and opportunity to support RSA-certificate allows it to be used by non-residents. Flexible system of configuration allows to attune it for optimal interaction.

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File Bridge - solution for partial integration

Worked out to create a message by entering the data into a graphical interface. The elaboration has the ability to construct messages in FpML blocks format. The elaboration has the ability to visualize the message structure based on customizable templates and mapping rules. In conjunction with the file gateway relieves the client from necessity to rework systems.

The Repository user’s interface FLEX (FpML Exchange) - solution for minimal integration

REPOSITORY: PRICING MODEL

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Non-profit infrastructure project; Take into account objective of covering costs of project; Creating special benefits for the market by market competition between Repositories existing.

Main incentives of Repository creating: Tariff principles:

Regressive model; Limitation of fees (upper cap); Mass marketing proposals; Commission is charged only for messages transferred to the Repository. Free of charge repository service till 01.01.2014.

Initial Grace Period

30 messages per month are free of charge at least till 31.12.2014.

Small Quantity Grace Period

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REPOSITORY: SCHEDULE OF FEES – FIGURES

Number of registered standard messages Tariff rate, RUB/USD

(USD/RUB rate 32,00)*

1 - 30 0** (for each message) 31 - 500 45/1.41 (for each message) 501 - 1 000 35/1.09 (for each message) 1 001 < 25/0.78 (for each message)

* Exchange rate is taken for the date of billing from the Bank of Russia Website ** Grace Period for 31.12.2014 *** The repo agreements under which the fulfillment of obligations under the second part of the repo agreement is made ​on the next business day after the fulfillment of obligations under the first part of a repo agreement

Commission will be charged only for messages transferred to the register. Messages sent during set-up process will be free of charge. They are: Message on repository agreement, Reporting Party Form etc.

Number of short repo messages*** Tariff rate, RUB/USD

(USD/RUB rate 32,00)*

1 - 111 45/1.41

(for each message)

112 - 1 000 5 000/156.25

(for all messages)

1 001 - 10 000 15 000/468.75

(for all messages)

10 001 - 25 000 25 000/781.25

(for all messages)

25 000 < 35 000/1 093.75

(for all messages)

Number of registered standard messages in paper form Tariff rate, RUB/USD

(USD/RUB rate 32,00)*

Any 3 000/93.75 (for each

message)

If the amount of fee exceeds 75 000 RUB (2 344 USD) the client will be charged fee equal to 75 000 RUB.

ANNEX

10 Saint-Petersburg Exchange Repository

LEGISLATION FRAMEWORK: OVERVIEW

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Law: according to the article 51.5 of the Russian Federal Law “On Securities Market”, “parties to the REPO contract, contract which is a derivative financial instrument concluded OTC as well as parties to the contract

• f another type concluded under general agreement, must provide information on such contracts to a self-

regulatory organization of professional participants of the securities market, clearing house or stock

• exchange. The Self-regulatory organization of professional participants of the securities market, clearing

house and stock exchange maintain the registers of contracts and submit them to the Central Bank of Russia”. Parties obliged to report to Russian repositories: Russian legal entities and natural persons which are parties of OTC trade made under master agreement as well as non-residents who made trades with Russian counterparties. Who can perform repository functions: self-regulatory organization of professional participants of the securities market, clearing house or stock exchange. What must be reported: master agreements (general agreement) and trades made under general agreement (general agreement) as well as amendments to them. Reporting time frame: reporting must be done within 3 working days. Trades which duration is less than 4 working days must be reported once a quarter in the form of special report (except repo transactions).

Saint-Petersburg Exchange Repository

LEGISLATION FRAMEWORK: REPORTING MOTIVATION

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Close-out netting is applicable only for trades registered by repository within set timeframe (3 working days). Administrative requirement is defined in Administrative code, violation of reporting terms set by the Central Bank of Russia is a subject to fines – for legal entities it’s 300k – 500k RUB ($9 155 - $15 258)*.

* As of 26/11/2013

LEGISLATION FRAMEWORK: INCURRENCE OF REPORTING LIABILITY TIMEFRAME

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05.02.2013 05.11.2013 9 months 9 months

Voluntary reporting period for OTC REPO and CCY SWAPs

24.09.2013

Obligatory reporting of other types of derivatives since 01.07.2014 Obligatory reporting of OTC REPO and CCY SWAPs since 05.11.2013 Voluntary reporting period for other types

• f derivatives

24.06.2014

Saint-Petersburg Exchange Repository

REPOSITORY: DOCUMENTATION AND LEGAL FRAMEWORK

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Regulations of Repository Services of OJSC “SAINT PETERSBURG EXCHANGE” shall establish the procedure for, and terms and conditions

• f, providing of repository services in accordance with Russian securities

market law. Repository Services Agreement is the Schedule No. 1 of the Regulations

• f the Repository Services. The signing of the Agreement between the

Repository and a client means an accede of the client to the

• Regulations. Clients can be residents or non-residents, natural persons
• r legal entities.

Schedule of fees is published on the WEB Site of the Repository.

Saint-Petersburg Exchange Repository

THANK YOU FOR YOUR ATTENTION!

Contact details: Tel.: +7 (495) 705-90-31, +7(499) 426-18-57 E-mail: repository@rts.ru www.spbexchange.com