SINGLE CENTRAL DEPOSITORY CONDUCTED FIRST TRANSACTIONS WITH SECURITIES ON MSE

The Single Central Depository of securities conducted the first settlements on deals with government securities, concluded on the Moldova Stock Exchange.

According to the National Bank of Moldova (NBM), the depository started operations with corporative financial instruments at the beginning of May, immediately after receiving Registers of security owners in banks and insurance companies and assumed all the functions of calculations on financial transactions.

The Single Central Depository has modern informational system, which proposes new possibilities for market participants. It is connected to the NBM payment system, which guarantees automatic implementation of payments on the mechanism “Supply For Payment”, provides to brokers remote access to and online management of financial instruments.

The NBM maintains that the advantages, proposed by the Depository, considerably extend the possibilities of implementing transactions, providing high level of protection and security.

Initially, the Single Member Depository will preserve the scheme T+3 (three days after the transaction conclusion) for settlement on transactions with shares. However, already since September it will start working on the basis of T+2 model in line with EU rules, hoping that the new model of settlement will raise the market liquidity and will lower the risk of nonpayments for transactions with financial instruments.

The creation of a Single Central Depository of securities is one of key reforms of the Moldovan financial market, implemented within the program with IMF with the support of the United States Agency for International Development (USAID). The new mechanism of accounting and settlement, provided by the Depository, is aimed at ensuring high level of transparency, security and efficiency at conducting transactions with securities. The depository’s activity is grounded on international standards and practices in the field of settlement systems, while the national legislation on the Single Central Depository implies the European Union regulations.