The Cyprus Stock Exchange (CSE) announced that effective Monday 6 October 2014 the settlement cycle of the transactions executed on listed securities that are traded on its markets will be shortened from T+3 (completion of settlement within three working days after the execution of a transaction) to T+2 (completion within two working days). This change is in accordance with the Central Securities Depository Regulation (CSDR), which among others aims to harmonise the securities settlement cycles in the European Union.
The CSE provided the following information regarding the change:
§ Migration to the T+2 settlement cycle, will take place on Monday 6 October 2014.
§ Trades executed until Friday 3 October 2014 will be settled following a T+3 settlement cycle, which means three days after the execution of the transaction.
§ Trades executed as of Monday 6 October 2014, will be settled following a T+2 settlement cycle, which means two days after the execution of the transaction.
Please note that the change to the settlement cycle from T+3 to T+2 will also apply in the cases of Over the Counter (OTC) trades which will be executed on the Central Registry/ Depository of the CSE.
Arrangements for the transition to T+2:
The settlement days for the transitional period are defined as follows:
Trade Day Settlement Day
Thursday, 2 October 2014 Tuesday, 7 October 2014
Friday, 3 October 2014 Wednesday, 8 October 2014
Monday, 6 October 2014 Wednesday, 8 October 2014
Tuesday, 7 October 2014 Thursday, 9 October 2014
Consequently, trades executed on Friday 3 October 2014 and on Monday 6 October 2014 will be settled on Wednesday 8 October 2014.
Particularly for the settlement of the trades with trade date Friday 3 October 2014, a different parameter value will be used within the Dematerialised Securities System for the Securities Settlement System. Specifically:
Securities Settlement System Provisional parameter for the
Securities Settlement System
Impact for Corporate Actions:
For the corporate actions that will be executed with record date from Wednesday 8 October 2014 and onwards the following will apply:
§ The ex-date for corporate actions e.g. cash distribution etc., will move from 2 business days before the record date, to 1 business day before the record date.
Ex Date = Record Date -1 (previously Ex Date = Record Date -2)
§ The last day of trading which applies to conversions of shares from one category to another, e.g. the reverse split etc., will be set to 2 business days preceding the record date.
Last Trading Date = Record Date -2 (previously Last Trading Date = Record Date -3)
§ July 2014 – Implementation of the required changes in the test environment of the Dematerialised Securities System and execution of migration tests.
§ September 2014 – Implementation of the required changes to the Regulatory Framework.
§ October 2014 – Migration in the production environment of the Dematerialised Securities System.
Eurivex Ltd., a Cyprus Investment Firm regulated by Cyprus Securities & Exchange Commission (CySEC) is acting as Paying Agent for corporate bond listings on the Vienna Stock Exchange when the registry is held with the Oesterreichische Kontrollbank Aktiengesellschaft (OeKB).
Oesterreichische Kontrollbank AG (OeKB) is a specialised institution providing central infrastructure for the Austrian capital market. OeKB is Austria’s central securities depository (CSD). It provides centralised custody and administration for nearly all Austrian securities. Also, the CSD is closely interlinked with the CSDs of other countries.
OeKB manages central data pools on Austrian securities, generates analytical data and is the national agency for assigning International Securities Identification Numbers (ISIN). It also acts as the notification office for the purposes of the Capital Markets Act and is responsible for the organisation and running of the automated auction system for government bond issues.
Eurivex, which is a specialized regulated EU investment firm advising corporations from any jurisdiction with their bond listings on the MTF Market of the Vienna Stock Exchange, acts as the Listing Agent preparing the Investment Memorandum and the Terms and Conditions, as well as acting as the Paying Agent for the custody of the bonds through its securities account held and maintained with the OeKB.
When Eurivex is entrusted with the task of acting as Paying Agent, it can deliver the dematerialized bonds to the custodian accounts of the bond purchasers to any custodian account held and maintained with Clearstream and or Euroclear via its link with the OeKB.
Corporations from many jurisdictions are increasingly choosing to list their corporate bonds on the MTF Market of the Vienna Stock Exchange, with clearing and custody held with the OeKB which allows a direct link with Clearstream Luxembourg bank and Euroclear and other international clearing agencies for direct settlement and transfer of securities.
The Multilateral Trading Facilities (MTF) are a form of “lite exchange” because they provide similar or competing trading services, such as rulebooks and market surveillance departments, but operate through simplified procedures and at very competitive fees than what it would cost to list financial instruments (shares, bonds, funds) on the traditional stock market segments.
The MTF Market of Vienna Stock Exchange is operated by the regulated Vienna Stock Exchange.
In Vienna they also refer to the MTF Market as the Third Market but trading in bonds goes through the same clearing and settlement structure.
The biggest advantages for listing in MTF Markets are:
TYPES OF BONDS
The Vienna Stock Exchange allows for most types of bond listings including:
– Traditional bonds with fixed coupon
– Floating rates
– Zero coupon bonds
– Performance linked bonds*, whose value is tied to the performance of the underlying asset.
*Performance Linked Bonds are increasingly becoming attractive since they spread the risk of performance on the investors.
Such Performance Linked Bonds may also be used for trading in capital markets in derivative products such as trading in shares, bonds and forex. When the trading performance is positive, the NAV will increase, whereas if there are trading losses, the NAV will decline.
The Vienna Stock Exchange prefers for Issuers to conduct their private placement of bonds and then list on the Exchange. An Issuer can apply for a larger amount of listing, but list the bonds in tranches of minimum EUR 200.000 lots over several years.
Eurivex will secure an Austrian AT-ISIN for the corporate bonds when it is appointed as Listing and Paying Agent.
Eurivex Contact details
Head Office Address: 2 Armenias Street, Office 101, Nicosia 2003, Cyprus
Telephone +357 22 02 88 31 Fax +357 22 25 53 18
Web site: eurivexstage.mystagingwebsite.com Enquiries: [email protected]
Eurivex is regulated by Cyprus Securities & Exchange Commission CySEC, license 114/10. © Eurivex Ltd. 2012. All rights reserved. No part of this document may be reproduced, stored or transmitted in any form or by means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of Eurivex Ltd. The material in this document is for informational purposes only and does not constitute legal or professional advice. No responsibility or liability is accepted by Eurivex Ltd in connection with the use of information contained in this document.