Transcript Slide 1

10th ACG Cross-Training Seminar
STP - CCASS Participant Gateway
Hong Kong Securities Clearing Company Limited
June 2008 - Bali
Agenda
Introduction
 Clearing House : HKSCC
CCASS
 Key features, Operations, Access channels
CCASS Participant Gateway (PG)
 Benefits
 Overview
 System components, Key features
Straight Through Processing
 C3T and PG
Q&A
2
Introduction of Clearing House :
HKSCC
•
HKSCC was incorporated on 5 May 1989 and was recognized as clearing
house on 28 May 1992
•
Merged with SEHK and HKFE, HKSCC became a wholly owned subsidiary of
Hong Kong Exchanges and Clearing Limited (HKEx) on 6 Mar 2000
•
•
What is CCASS ?
Central Clearing And Settlement System
•
It is a system providing book entry settlement for securities in cash market
•
Ordinary shares, preference shares, registered warrants, PAL, unit trusts,
funds, debt securities, structured products (e.g. derivative warrants, callable
bull/bear contracts and listed equity linked instruments) listed on the Stock
Exchange are eligible for admission into CCASS
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CCASS: Key features
•
Centralised
– A centralised system for all market intermediaries to transact business
•
Electronic linkage
– All Participants must be electronically linked with CCASS
•
Electronic Book Entry System
– Settlement is done on a book-entry basis where no physical movement of
certificates and cash is involved
– Securities and cash are exchanged on a Delivery Versus Payment basis
•
CCASS Participant
Seven categories of Participants: Custodian Participants, Direct Clearing
Participants, General Clearing Participants, Investor Participants, Clearing
Agency Participants, Stock Lender Participants and Stock Pledgee
Participants.
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CCASS Operations
Selling
Broker
Order
Order
HKEx
HKEx AMS
AMS
(1)
(1)
Buying
Broker
Trade Data
CCASS
(2a)
Delivering
Clearing
(2b)
Participant
(3)
(2a)
(2a) HKSCC as the counter-party for
securities and money settlement
Receiving
(2b) HKSCC as the facilitator for securities
settlement and, where applicable, for
money settlement
(3)
Securities transfer between participants’
stock accounts
(3)
Custodian / Stock
lender / Stock pledgee
/ Clearing agency
Securities settlement
Money settlement
(2b)
Clearing
Participant
(3)
(4)
Investor
SIs or ISIs
Input or affirm ISIs
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Access to CCASS
Five channels for Participants to access CCASS:
CCASS
CCASS Terminals
CCASS
Internet System
CCASS Phone
System
Participant Gateway
Service Counter
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Access to CCASS
- C3T & PG
In the CCASS Architecture Upgrade Project, two Communication
Channels were developed as part of technology upgrade:
CCASS/3 Terminal (C3T)
• Access to CCASS through a browser-based terminal
• C3T Functions: Enquire portfolios, movements and transactions;
input data, upload files and download reports
Participant Gateway (PG)
• A technical device installed at the Participants’ premises to provide an access
point through which Participants’ back office systems can communicate with
CCASS on a message basis
• Adoption of PG is optional to CCASS participants
Both C3T Functions and PG Messages were processed by the
mainframe in a similar fashion
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Network Connectivity
- C3T & PG
• C3T and PG are connected to the CCASS Host system via SDNet
• It uses the TCP/IP protocols with high security protection by means of
firewall and intrusion detection systems
CCASS/3 Terminal
HTTPS
HTML
FinNet
CCASS/3
Terminal (C3T)
HTTPS
PG / PSS
ISO / User Defined
Messages
API
ISO / User Defined
Messages
Participant Supplied
Systems (PSS) [1]
CCASS/3
SDNet
Frame Relay WAN or
ISDN
CCASS/3
CCASS/3
Participant
Gateway (PG)
Participant
Gateway (PG)
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C3T
(Browser based interface)
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PG
(Message based system)
Example: Input Settlement Instruction (SI)
Input Message
Wed Dec 19 17:00:55 CST 2007 Send
0 :{1:CMT1n009bsgxv00000446}{2:I540B01323
X}{4:
:16R:GENL
:20C::SEME//123455004A00002
:23G:NEWM
:98A::PREP//20071111
:16S:GENL
:16R:TRADDET
:98A::SETT//20071111
:35B:/HK/1
:16S:TRADDET
:16R:FIAC
:36B::SETT//UNIT/2000,
:97A::SAFE//01
:16S:FIAC
:16R:SETDET
:22F::STCO/CCAS/DINR
:22F::SETR/CCAS/RTRL
:16R:SETPRTY
:95R::DEAG/CCAS/H00001
:16S:SETPRTY
:16R:SETPRTY
:95Q::BUYR//abc company
:97A::SAFE//1234567890
:16S:SETPRTY
:16R:AMT
:19A::SETT//HKD0,
:16S:AMT
:16S:SETDET
-}{5:{CHK:0000000062CA5359}}
Output Message
Wed Dec 19 17:01:00 CST2007Received:
{1:CMT1n009bsgxv00000165}{2:O598B01323X}{
4:
:20:PG87860000502805
:12:001
:77E:
:20C::PREV//123455004A00002
:20C::SIIN//I16181312
:25D::PROC//SUCC
:70E::ERRE//EMSG/RECORD ADDED
SUCCESSFULLY
/ENUM/-2003
-}{5:{CHK:00000000D3611177}}
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Benefits of using PG
1. Straight-through-processing (STP)
Using the PG access mode, CCASS/3 functions are performed by the
transmission of standard messages. Transactions input to the PSS
can be routed to CCASS/3 directly, without the need to re-input to
CCASS via C3T
2. Real-time data feed to CCASS
3. No time constraint for instruction processing
4. Tightening up the internal control without manual
intervention
5. Cost effectiveness
Most suitable for high volume data exchange without the need to go
through the input processing via CCASS/3
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Overview of PG
•
An alternative access channel to CCASS
•
PG is a Windows 2000-based device installed at the participant’s premises
•
It is designed to support participant back office system (Participant Supplied
System or PSS)
•
It facilitates a direct electronic interface between PSS and CCASS with the
aim to achieve data straight through processing eventually
•
PG is a message-based gateway. All communications between PSS and
PG are done through messages
•
Messages follow the SWIFT ISO15022 as possible.
•
In general, each message sent from and received at PSS can represent a
business transaction in CCASS
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Overview of PG
• PG acts as a router to route requests and responses between PSS and CCASS
Example: Input Settlement Instruction (SI)
PSS
Input Message
Send an
input
message for
delivery /
receipt of
securities
either FOP
or DVP
Output Message
CCASS/3
Return a
reply
message
specifying
the SI input
no. as a
unique
reference to
the
instruction
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Aim of developing PG
•
To meet international standards in providing open access and connectivity
for CCASS Participants to access CCASS
It will bring Hong Kong into line with prevailing as well as emerging industry
standards and will prepare the Hong Kong market to meet the challenges
of increasing globalization of financial markets
•
•
ISO 15022 Securities Messaging Standard (“ISO
Standard”) is adopted as the messaging standard
which pave the road for Straight Through Processing
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PG: System components
There are mainly 3 components in a PG system:
•
PG Administrator Main Window
- It is a front-end GUI interface
- A participant can perform login/logout from C/3, check the communication
status between PSS and C/3 etc.
•
PG Engine
- It serves as a common architecture component in PG that provides the
technical services
- It allows an integration of different electronic exchange platforms,
information providers
•
PG Application Programming Interface (API)
- It provides an open system that participants can attach their own
applications.
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PG: Key features
• Message Routing
- route requests and responses between PSS and CCASS
• Support for concurrent transactions
- support multiple transactions sent from PSS concurrently by using PGAPI
• Message encryption and authentication
- ensure secured transmission between PSS and C/3
- smart card for its authentication to C/3
- PSS’s authentication to PG via PG-API : PSS ID and Password
• Asynchronous message processing
- distribute CCASS broadcast message and notification to PSS
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Straight through processing
- C3T
Terminal input
Participants input instructions via C3T and print out CCASS
reports in text format
CCASS/3Terminal
STP - Batch File Upload
• Instead of inputting instruction one at a time by on-line data entry, Participant
may use batch file containing a number of instructions and upload to the
HKSCC host computer to save effort
• The batch file is a DOS file created according to a certain format stipulated
by HKSCC.
• After uploading, CCASS will validate and processed the uploaded batch files
upon receipt or at scheduled times
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Straight through processing
- C3T
• Input control report will be generated to indicate which records are rejected
and give a summary of result for each validated batch file
• Batch upload function is suitable for participant with a high volume of
instructions. Subscription to this service is not required.
STP - Report Data Download
• Participant can download the CCASS reports in data file format and process
the downloaded report files according to their own internal processing
requirements
• Data file format are available for most of CCASS reports
Participants may develop back office system to capture and process the data
files to streamline their internal processing and avoid duplicating efforts in
manually rekeying instructions into CCASS
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Straight through processing
- PG
• Participants can connect their own back-office systems (Participant Supplied
System, PSS) to CCASS through PG
• By integrating PSS to PG (via PG-API), participants can design their clearing
and settlement back-end process and front-end user interface to meet their
business and operational requirement
• PG is responsible for communicating with PSS but not further down to
the other backend system
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Straight through processing
- PG
Daily operation flow in PSS
PG
PSS
(1) PG User Sign-On
C/3
(2) PSS Sign-on
(3) B/c and Notification subscription
(4) Data Download
(4) Data Download
(5) Online Activities,
Reports and Data Files Download
(5) Online Activities,
Reports and Data Files Download
(6) Broadcast and Notifications
(6) Broadcast and Notifications
(7) Overnight Report Download
(7) Overnight Report Download
(8) PSS Sign-out
(8) PG User Sign-Out
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Straight through processing
- PG
• PSS is the main initiator for both online and batch transactions. PSS can initiate
business transaction, file upload, report / file download and receive broadcast message
& notification
• All transactions are based on the Request-Response processing, PSS will have to wait
for the response from C/3 for every transaction sent. An end-to-end transaction is
considered complete once the Txn-Response is received.
PG
PSS
(1)Txn Request
w Initiate ad hoc txn
w Receive
synchronous
response
C/3
(2)Txn Request
w Route Txn
Request/
Response to
corresponding
parties
(4)Txn Response
(3)Txn Response
w
w
Validate Txn
Perform update or
query
w Generate Ref Key
w Format result
w Notify result
• Transactions input to the PSS can be routed to CCASS/3 directly, without the need to
re-input to CCASS via C3T
• This facilitates straight through processing for improved operational efficiency and
reduced risk
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CCASS Functions supported
by PG
All functions supported by CCASS/3 via PG can be categorised into 3
groups
PSS
w Initiate business
txn
w Initiate fileupload
C/3
Business Transaction
File Upload
w Response to
business txn
w Response to fileupload
w Initiate request
and receive file
download
File Download
w Distribute filedownload
w Receive AM
Asynchronous Message(AM)
w Distribute AM
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CCASS Functions supported
by PG
• Clearing and Settlement function
Maintain DI, DI, ISI, ATI and STI
• File Transfer
SI, ISI, ATI and STI File Transfer
• Enquiry
Enquire Settlement Account/Status
• Report Download
Data File Download (Start of Day), Overnight Report
Distribution (Download), Report Download (Online) and
Report Profile Maintenance
• Asynchronous Message
Broadcast/Notification Messages
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Q&A
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