CDCP Upcoming Changes

Slovakia
UniCredit Bank Czech Republic and Slovakia, a.s., pobočka zahraničnej banky
Summary: 
CDCP has announced forthcoming changes related to the allocation of LEI codes, the introduction of T+2 settlement cycle for on-exchange transactions, the developments of its systems with respect to T2S as well as changes in its price list
Wed, 02/04/2014

The Slovak Central Securities Depository, CDCP, at its last Services Committee meeting shared information on the development of its projects and announced changes to its price list valid as of 1 April 2014.

Allocation of LEI Codes

In accordance with EMIR, LEI codes will be used as a general system for the identification of legal persons, organisations and entities (excluding individuals) entering the financial markets. CDCP is currently actively communicating with the Slovak National Bank (SNB) as its sponsor drafting the documents, based on which SNB will recommend the approval of CDCP as a local operating unit authorised to allocate LEI codes.

T+2 Settlement Cycle

BSSE and CDCP will shorten the settlement cycle for on-exchange trades to T+2 as of 6 October 2014. The settlement of direct trades and repo deals, only reported via BSSE for settlement, and off-exchange trades that are settled directly at CDCP will not be impacted as they are already settled under negotiable cycles, ranging from T+0 to T+15.

T2S

The Board of CDCP signed a contract for the supply of the necessary changes in its information system. Both current systems will be replaced by a new GUI interface based on thin client technology. The existing interface of CDCP will be replaced by a new interface in the ISO20022 format along with proprietary CDCP formats where ISO20022 is not appropriate.

The key changes to the CDCP systems include:

  • noticeable reduction (as a result of optimisation) in the number of services following the introduction of ISO200222
  • change in the expression of Quantity of Financial Instrument in the instructions in accordance with the standard - equity securities in number of pieces, debt securities in face value
  • identification of each member in the CDCP system by BIC code

The deployment of the changes to the CDCP systems is planned in two stages.

  • Stage I - August 2015
    • New hardware platform
    • New GUI based on ISO20022
    • New rules for pairing according to T2S
    • New procedures for working with static data
    • Communication with T2S under the existing settlement procedures
       
  • Stage II - February 2017
    • GUI without major changes
    • Communication with T2S under T2S settlement procedures

Price List Changes

  • New services related to the activities of the local operator for issuance of LEI codes
  • Registration / termination of blocking of securities with the consent of the applicant in order to exercise purchase rights
  • Addition of a provision that transitions of securities are charged as securities transfers

Impact on investors: The shorter T+2 settlement cycle, effective from 6 October 2014, will reduce settlement risk. The replacement of the CDCP system would enable the communication between CDCP and its members via ISO20022.