Transcript Securities Depository System in Japan

Updates of Activities
from CSDs in Asia-Pacific
Region
7th Meeting of AMEDA
Mauritius
May 23, 2008
Yoshinobu Takeuchi
President & CEO
Japan Securities Depository Center, Inc.
Asia-Pacific CSD Group

Profile
►Name:
Asia-Pacific Central Securities Depository
Group (ACG)
►Date of establishment: November 1997
►No. of members: 30
►Objectives: to facilitate the exchange of information
and to promote mutual assistance among member
securities depositories and clearing organizations in the
Asia Pacific region.
2
Asia-Pacific CSD Group (cont.)
- ACG Member List 1
Australian Securities Exchange
11
PT. Kustodian Sentral Efek
Indonesia
21
New Zealand Central Securities
Depository
2
Central Depository Bangladesh
Limited
12
Indonesia Clearing and
Guarantee Corporation
22
Central Depository Company of
Pakistan Limited
3
China Securities Depository
and Clearing Corporation
Limited
13
Japan Securities Depository
Center, Incorporated
23
National Clearing Company of
Pakistan Limited
4
China Government Securities
Depository Trust and Clearing
Co,.Ltd
14
Japan Securities Clearing
Corporation
24
Philippine Depository & Trust
Corp.
5
Hong Kong Monetary Authority
15
JSC "The Central Securities
Depository"
25
The Central Depository (Pte)
Limited
6
Hong Kong Securities Clearing
Co., Ltd
16
Korea Securities Depository
26
Central Depository Systems
(Pvt.) Limited
7
Central Depository Services
(India) Limited
17
Bursa Malaysia Depository Sdn
Bhd
27
Taiwan Depository & Clearing
Corporation
8
National Securities Clearing
Corporation Ltd.
18
Bursa Malaysia Securities
Clearing Sdn Bhd
28
Thailand Securities Depository
Co., Ltd.
9
National Securities Depository
Limited
19
Maldives Securities Depository
29
Uzbekistan State Central
Securities Depository
10
BOI Shareholding Limited
20
Mongolian Securities Clearing
House and Central Depository
30
Vietnam Securities Depository
Center
3
Asia-Pacific CSD Group (cont.)

Activities
►General
•
•
The 11th General Meeting was held on Sept. 2007 in
Beijing, China, hosted by SD&C.
Next General Meeting will be held on 9-11th of November
2008 in Singapore, hosted by CDP(SGX).
►Task
•
•
•
•
Forces
Information Exchange Task Force
New Business Task Force
Risk Management Task Force
Technical Task Force
►Cross
•
Meeting
Training Seminar
Next Cross Training Seminar will be held on 1-5 June
2008 in Bali, Indonesia under the theme “STP”.
4
CSD Interim Meeting

Date and Place
►

Attendees
►

April 16, 2008, Tokyo
26 people from 16 CSDs in 5 regional CSD groups
Objectives
►To
promote interactions among CSDs
►To exchange views and opinions in a rapidly changing environments
surrounding CSDs in the world
►Based on the above thoughts, the meeting was proposed by
JASDEC at “Top Management Meeting” in CSD9.
5
CSD Interim Meeting (cont.)

Agenda
Updates from regional CSD groups
•
5 regional group made presentation about the
developments of each CSD group’s activities.
►
►CSD
10 (Budapest) updates
•
KELER (Hungary) presented a current draft programs of
CSD10 for review by attendees.
► Breakout session
•
Members were divided into two groups and discussed the following
topics
-
Cross-border settlement & Corporate action processing
Disclosure Framework
6
CSD Interim Meeting (cont.)

Agenda
►World
•
•
•
•
Assessment of CSD meetings in the past
Holding of CSD Interim Meeting
World CSD Meeting / World CSD Group
Specific Topics for discussion
-

•
•
CSD Group
Disclosure framework
Consultative committee of CSD meeting
Delivering message from worldwide CSDs
Attendees identified specific area for cooperative work
Disclosure framework
Consultation for CSD meeting
7
Worldwide Activities of CSDs

Current Environments
Importance of capital markets as a key driver for
economic growth
► Complexity of capital markets & financial instruments
leads to the need for CSDs to provide value added
services
► Globalization of capital markets needs closer
relationship among market infrastructures in the world
►

What is the next step?
8
Dematerialization of
Stocks, etc in Japan
9
Reform of
Securities Settlement System

Significance of the Reform
►
The reform started in June 2000 after the Financial
System Council published a report about reform of
the financial system
Reform of Japanese
securities settlement
system
-
Demutualization of CSDs
Unified legal system
Introduction of paperless system
STP & DVP
10
Purpose of the Reform
DVP
•DVP for street-side and
customer-side transactions.
•The issuance of new stocks.
Key
Points
STP
•The introduction of PSMS.
(Pre-Settlement Matching System)
Paperless
•Introduction of Paperless
System.
- Government Bonds
- Commercial Paper
- Corporate Bonds
-Investment Trusts
-ETFs
The principal risk has
been eliminated.
STP from trade
matching to settlement
was devised.
As the final stage of
the paperless
scheme, the
dematerialization of
stocks is underway.
11
Paperless System for Stocks
For Shareholders:
• Lowers
the risks of lost or stolen share
certificates.
• Eliminates the need for
Benefits
- delivery of physical certificates
- physical registration of shareholders’ name
- exchange of share certificates in case of
corporate reorganization
For Issuers:
• Reduces
the costs related to the
issuance of stocks and handling of
shareholders’ matters.
Enhancement
of STP
Mitigation of
risks
For Securities Companies:
• Eliminates
the need for delivery of
physical certificates.
12
Transition to Paperless system
Shares with JASDEC
- No specific procedures are necessary.
- Shares are transformed into
dematerialized form automatically.
- Holders will be able to trade shares from
the enforcement date.
Shares outside JASDEC
-Shares are transferred to a “Special account”
at the time of enforcement date.
- In case the shareholders want to sell such
shares, certain procedures need to be taken.
13
Challenges for post-paperless





Enhancement of international competitiveness
of Tokyo financial markets
Response to international standardization
Expansion of business scope of CSDs
Strengthening cooperative relationship with
overseas CSDs
Exchange of information regarding the
markets in electronic means
14
Thank you for your attention.
15