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Central Depository, Clearing and Settlement System

Central Depository, Clearing and Settlement System
The clearing and settlement system is an inte-grated solution for Clearing & Settlement Compa-nies that covers all aspects of the settlement and clearing of the securities positions for stock broker-age companies resulting from the buying and sell-ing transactions executed on the Stock Exchange (S.E) under which money is credited or debited.

Objectives of the Settlement and Clearing System

  • Facilitating securities trades to encourage higher level of trading activities.
  • Reducing risks resulting from handling shares during trading process.
  • Applying the Delivery versus Payment prin-ciple (DVP), which is the norm in interna-tional capital markets.
  • Executing the clearing and settlement transaction at an exact specified period.
  • Speeding up securities turnover as a result of guaranteeing the completion of the set-tlement in a specified time.

Features

  • Customizable time frames to settle different types of securities to meet the market rules.
  • Supporting the DVP (delivery versus pay-ment) mechanism.
  • Intensive reporting.
  • Integration with the Settlement Guarantee Fund (SGF) system.
  • Security measures to prove securities own-ership authenticity.

The Central Depository

Central Depository system handles all activities related to the depository of securities, Clearing, Settlement of financial positions resulting from trading transactions, and the transfer of securi-ties ownership through book entry including: the pledge of securities, the clearance and set-tlement of financial positions

Objectives of the Central Depository System

  • Eliminating counterfeiting risks resulting from the circulation of the physical securi-ties certificates.
  • Faster & easier trading of securities in the capital market.
  • Ensuring the safety of securities registered in the central depository.
  • Guaranteeing transactions safety by offering fully automated services during the circula-tion of securities within the central deposi-tory system.
  • Eliminating the need to print physical shares.
  • Establishing an integrated database of shareholders’ accounts for all issuers regis-tered in the central depository system.
  • Establishing an integrated database of all securities registered in the central deposi-tory system.
  • Adopting international standards based on the Group of 30 recommendations to meet international capital market standards.

Advantages of the Depository System

  • Trading of securities registered in the cen-tral depository system is done in book-entry form.
  • Settling trades on their due date and in an organized automated mechanism.
  • Availability and reliability of information re-lated to shareholders’ identification and ac-counts.
  • Facilitating corporate actions (stock divi-dends distributions and cash dividends pay-ments).
  • Reducing hassles and costs experienced by issuers, who no longer need to follow up the transfer of ownership and the corporate ac-tions.
  • Achieving the central possession through the schedule withdrawal of securities regis-tered and traded on S.E and exempting the issuers from printing scrips.
  • Establishing an integrated database of all securities registered in the central deposi-tory system.
  • Simplifying the process of trading in S.E as a result of dealing in stocks through book-entries.
  • Increasing stock turnover as a result of ac-complishing transfer of ownership in fixed times.
  • Increasing the liquidity on the marketplace.
  • Settlement system operates on Delivery Versus Payment (DVP) basis.
  • Releasing the issuers from cost, effort, time they take to print scrips for the original capital or any amendment that may occur on the capital and print one scrip with total issuing value.

The Central Registry

Managing the shareholders’ records for the issuing companies. Keeping the shareholders ’records is considered one of the important services presented to the is-suing companies. The Clearing and Settlement sys-tem provides its mentioned services through its database. On a daily basis, database is updated in accordance with the operations that affect the cli-ents’ balances. The Clearing and Settlement system provides one of the most important services, which is the identification of Shareholders with its different usages for the participants in the CDS.

Purposes of preparing the shareholders list

  • Identifying the shareholders structure or the meeting of the General Assembly.
  • Presenting the list to the legal authority on demand.
  • Executing the corporate actions (cash divi-dends or free shares...etc).

General Features

  • Support for different types of trading opera-tions.
  • Customizable to accommodating different governing rule and regulations.
  • Available in different languages.
  • Scalability.
  • Different timing for settlement.

 

About Nile Information Technology & Dissemination

Nile Information Technology & Dissemination (NITD) is established by MCDR, the national Clearing, Settlement & Depository of Egypt, National Bank of Egypt and other investors. NITD is specialized in the area of financial applications, digital signature, security and compliance as well as providing SWIFT managed services. Through partnerships with leading global solution providers, NITD represents an array of financial applications for the capital market, financial institutions, corporates and government. NITD built the first SWIFT service Bureau in Egypt, offering services to over 60 Egyptian and international financial institutions. NITD provides network & Internet authentication solutions based on digital certificates for communicating and conducting authenti-cated business, which is essential for global eTrade. NITD provides solutions and services to automate and integrate the roles of different key players in the capital market. NITD hosts its applications and services in an ISO27001 certified data center providing a safe and secured environment to all our cli-ents.

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