Russia’s NSD gains repo contract parity
13 July 2017 Moscow
Image: Shutterstock
The National Finance Association (NFA), a self-regulatory organisation of Russian financial markets, has declared that repo agreements using the National Settlement Depository’s (NSD) collateral management services are on par with traditional master agreement standards.
The standard form of the master agreement allows NSD clients to reduce the time required to develop contractual documents with counterparties, as well as to use NSD’s triparty services, in particular, for inter-dealer repos.
NSD developed the additional agreement form for clients who have already signed master agreements with counterparties.
Alina Akchurina, managing director for collateral management and triparty services, NSD, said: “A standard master agreement form for concluding repos with collateral management functions delegated to a neutral intermediary is a common practice supported by national regulators.”
“The standard forms are optional for clients using NSD’s triparty services, and the participants may continue to use their own agreement forms. However, many clients prefer to sign the standard forms.”
Previously, the NSD, in partnership with Bloomberg, launched a new collateral management service for over-the-counter repo transactions in March.
The platform aims to expand the number of users of NSD’s collateral service and allow new repo transactions to be processed “in a similar way to the functionality available for repos with the Bank of Russia and the Federal Treasury”.
NSD’s existing system currently services 192 participants.
In a statement on the launch, NSD described its role as keeping general collateral certificates and basic assets, as well as providing collateral management services to automatically select clients’ securities for the pool on the basis of selected parameters and for margins calls.
The standard form of the master agreement allows NSD clients to reduce the time required to develop contractual documents with counterparties, as well as to use NSD’s triparty services, in particular, for inter-dealer repos.
NSD developed the additional agreement form for clients who have already signed master agreements with counterparties.
Alina Akchurina, managing director for collateral management and triparty services, NSD, said: “A standard master agreement form for concluding repos with collateral management functions delegated to a neutral intermediary is a common practice supported by national regulators.”
“The standard forms are optional for clients using NSD’s triparty services, and the participants may continue to use their own agreement forms. However, many clients prefer to sign the standard forms.”
Previously, the NSD, in partnership with Bloomberg, launched a new collateral management service for over-the-counter repo transactions in March.
The platform aims to expand the number of users of NSD’s collateral service and allow new repo transactions to be processed “in a similar way to the functionality available for repos with the Bank of Russia and the Federal Treasury”.
NSD’s existing system currently services 192 participants.
In a statement on the launch, NSD described its role as keeping general collateral certificates and basic assets, as well as providing collateral management services to automatically select clients’ securities for the pool on the basis of selected parameters and for margins calls.
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