KELER, the Hungarian CSD, today published a client information document to provide market participants with more details on its strategy for the years 2023 and 2024.
The new strategic directions, including key implementation projects and the planned draft schedule, were presented to the market participants in the first and second quarters of 2023.
At the same time, KELER worked out the 2023/2024 development portfolio for the next period, taking into account the results of the ‘client development needs’ assessment carried out in March this year.
The information now released is in line with KELER's plan during the implementation to regularly inform its clients about the most important development tasks for the next time period and the planned changes that will affect market players. KELER is committed to consulting with the market participants prior to commencing development on major tasks and projects, in order to take into account market needs and comments.
In the material published, KELER has defined the development directions in the following main lines:
Extension of the CAPS services to cover new types of securities
In line with the requirement to comply with the AMI-SeCo Corporate Action Standards, KELER will extend the services of its web-based application CAPS beyond equities to other dematerialised securities having Hungarian ISIN code, such as government securities, corporate bonds and listed investment notes. The development project is in preparatory phase, KELER expects to publish more details by the end of September 2023.
Implementation of partial release
The functionality will be based on the process implemented in T2S and on the existing hold/release and partial settlement functionality in the KELER settlement system, so that the related settlements will predictably only take place in the partial settlement windows. The new solution helps to improve settlement efficiency and reduces the number of transactions that fail to settle on the scheduled settlement day and the associated fines. The development is currently in preparatory phase, further details will be published by the end of September 2023. Market consultations prior to the approval of the specification and testing opportunities are also offered by KELER.
SWIFT Release 2023
KELER follows the changes in the ISO 15022 and 20022 standards within the framework of the usual annual release and implements them in its systems and in business functionalities. The main changes are related to the messages wired through CAPS, KELER’s application managing the Corporate Actions. KELER will implement the new message versions in CAPS on 19 November 2023, in line with the 2023 SWIFT Release. Further information is expected to be published by KELER during September 2023.
Introduction of ISO 20022 messages on SWIFT for settlement transactions
Taking advantage of the elements and capabilities of the infrastructure established within the KELER KSDP in December, 2021– the capability to send and receive ISO 20022 standard MX messages – KELER aims to enable the distribution of MX messages via the SWIFT channel for its clients. In this way, KELER provides an alternative channel for its clients currently using KID, KELER’s proprietary system. KELER also wants to meet the demands of the gradual phase-out of messages based on the ISO 15022 standard in terms of securities settlement services. The type and versions of the messages will follow the T2S standard message versions, taking into account the consensus solution reached during the customer consultation held earlier this year. The internal KELER tests and market tests are planned for October/November 2023, while the go-live of the function is planned for February 2024.
KELER KID’s self-administration module
Direct clients of KELER will be provided with administration rights within KID (interface to contect to KELER’s settlement system) with regards to administrative tasks like change of login and signature rights, furthermore procedures of certain administrative transactions will be significantly simplified. This will give KELER customers using KID more control over user management. Internal KELER and market tests are planned for October/November 2023, while the implementation of the module is planned for the second half of December 2023.
Changes affecting MT message validation based on MyStandards (unification of MX-MT validation)
As part of the new strategy, based on the experience of one and a half years since the implementation of KELER’s new settlement system, KELER revises the validation rules of the currently accepted MT (ISO 15022) messages. The goal is to implement KELER’s MyStandards-based validation for these messages, in line with the validation of MX (ISO 20022) messages and increase the level of automation. The impact analysis is ongoing, KELER will present the planned solution on the next meeting of the HU-NSMPG working group, followed by a detailed schedule developed in agreement with the members of the working group.
Impact on investors: Several changes are expected in relation to securities settlement and corporate events procedures for direct KELER clients. The published information is currently being analyzed to determine the changes that will directly affect investors