Transcript Slide 1
10
th
ACG Cross Training
Depository & Trading Linkage
3 June 2008
Singapore Exchange
Agenda
Objectives of Depository Linkage CDP Existing Depository Linkage An example of Depository Linkage (CDP DTCC) Objectives of ASX-SGX Linkage ASX-SGX Linkage
Objectives of Depository Linkage
• Diversification of Portfolio • Time to market • Foster closer relationships between depositories
CDP Existing Depository Linkage
• Depository Trust Company (DTCC) • Shenzhen Securities Registrars Company Ltd (SSRC)
CDP-DTCC Linkage
Transfer of shares into CDP
CDP
1b. Submit transfer request form & payment by 10.00 am on settlement date 3. Confirm credit of shares into CDP’s a/c via SWIFT
Investor
4.Credit shares into investor’s a/c
DTC
1a. Instructs to deliver shares
DTC Participant
2. DTC Participant transfers shares
CDP-DTCC Linkage
Transfer of shares out from CDP
CDP
1b. Submit transfer request form & payment by 10.00 am on settlement date 3. Instructs to transfer shares from CDP A/c to designated DTC participant’s A/c via SWIFT
Investor
2. Earmark shares in investor’s a/c 6.Debit shares into investor’s a/c 5. Confirms debit of shares from CDP’s A/c
DTC
1a. Instructs to receive shares
DTC Participant
4. DTC transfers shares into Participant’s A/c
Objectives of ASX-SGX Linkage
• Encourage portfolio diversification for investors • Offer competitively priced trading/ settlement/custody services for cross border transactions • Provide another channel for order flow to exchanges • Create a revenue and profit stream for exchanges
ASX-SGX Linkage
• Established in December 2001 • This trading link provides market participants with access to market/ on selected overseas securities trading information • It allows transmission of orders through local existing trading terminals, directly into the electronic trading system of that exchange for order matching.
ASX-SGX Linkage
• The link also encompasses clearing and settlement of the above securities in its primary market. Securities holdings or its proxies are reflected in accounts held through custodian banks by the respective depositories.
• Inbound service from ASX to SGX discontinued in February 2006 • Outbound service from SGX to ASX discontinued in September 2006
ASX-SGX Linkage
Sells 1 lot Qantas @ A$3 ASX Investors
ASX SEATS AUSTRALIA
ASX SPV Match 1 lot Qantas trades @ A$3 Trade Details
CHESS
Net Settlement with CHESS Citibank (CHESS Participant) Net Settlement Instruction Settlement Confirmation
SINGAPORE TRADING
SGX Link
C D P
Buys 1 lot Qantas @ A$3 SGX Member Singapore Investors Trade Details
SETTLEMENT
Pays A$3000 SGX Member Delivers 1 lot Qantas Singapore Investors