central securities depositories functions: el salvador case acsda 2005 seminar punta del este,...
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CENTRAL SECURITIES DEPOSITORIES FUNCTIONS: EL SALVADOR CASE
ACSDA 2005 Seminar
Punta del Este, Uruguay, October de 2005.
MARIANO NOVOA FLORESCEDEVAL-President
Presentation Estructure
Antecedents. El Salvador Securitie’s Market Evolution
Central Securities Depository Evolution
Goals Achieved
Depository Benefits
Proyects in Development
CENTRAL SECURITIES DEPOSITORIES FUNCTIONS: EL SALVADOR CASE:
1. ANTECEDENTS
1.1 El Salvador Securitie’s Market Evolution.
1989
Constitution of the society named “Mercado de Valores de El
Salvador” (BVES)
1989
Constitution of the society named “Mercado de Valores de El
Salvador” (BVES)
1994
Issue of the Securities Market Law
1994
Issue of the Securities Market Law
1992
Inauguration and first trade in the stock exchange.
1992
Inauguration and first trade in the stock exchange.
2002
The Congress approved the Electronic Book-Entry Law
2002
The Congress approved the Electronic Book-Entry Law
2004
Dematerialization of securities
2004
Dematerialization of securities
2004-2005
Dematerialization of securites issued by the goverment of El
Salvador and the Reserve Central Bank of el Salvador
(BCR)
2004-2005
Dematerialization of securites issued by the goverment of El
Salvador and the Reserve Central Bank of el Salvador
(BCR)
1997
Beguinning operations of Securities Superitendence of El
Salvador
1997
Beguinning operations of Securities Superitendence of El
Salvador
1999
Implementation of the Electronic Settlement System
1999
Implementation of the Electronic Settlement System
1998
CEDEVAL begins operations
1998
CEDEVAL begins operations
1961
Established the first stock exchange in El Salvador.
1961
Established the first stock exchange in El Salvador.
1976
The low negociation levels brought the closing of the stock
exchange.
1976
The low negociation levels brought the closing of the stock
exchange.
1986
The promoting members of the actual stock exchange
1986
The promoting members of the actual stock exchange
1999
Inscription and trading of international securites
1999
Inscription and trading of international securites
1999
Implementation of Risk Clasification to both Issuers
and Securities Issues
1999
Implementation of Risk Clasification to both Issuers
and Securities Issues
2002
Inauguration of the Electronic Trading System, SIBE
2002
Inauguration of the Electronic Trading System, SIBE
1.2 Evolution of Central de Depósito de Valores: CEDEVAL
Main objectives of CEDEVAL:
To contribute to the reduction of risk in the securities processing industry.
To insure investors the availability of the securities adquired by the investors.
To provide information in a safe and flexible inviroment, to contribute the investor’s best decision.
CEDEVAL S.A. DE C.V. Within the salvadorean securities market, is the specialized entity in safekeeping and administration of securities via its higly secure electronic system.
1.2 Evolution of Central de Depósito de Valores (Cont...)
Operations begining.
19981998
20012001
In 2001 in force The Money Integration Law.
International Custodian’s agreements:
Clearstream Banking and Deutsche Bank
20022002
Electronic Book-entry Securitie’s Law approbation.
The creation of The Issue’s Electronic Register and Securities Accounts Electronic Register.
Improvements in the technologic platform of CEDEVAL.
September of 2003 CEDEVAL and BURSATEC (México) sign a contract of permanent and actualized maintenance of the operations and values accounts in custody.
Dematerialization of securities.
20032003
1.2 Evolution of Central de Depósito de Valores (Cont...)
20042004
TrueSecure’s Certification as a entity that offers safe, effective technologist and communication services for its customers using international best practices and standars.
20052005
Begins electronic registration of the values issued by the Goverment
and the Central Reserve Bank of El Salvador.
Opening of securities accountsSafekeeping and management of securities
Transactions Clearing and settlementSettlement of crossborder transactions
Guaranties processingCollection Agents
Share SplitsLocal and International safekeeping
CEDEVAL provides their Participants main services such as follow:
1.2 Evolution of Central de Depósito de Valores (Cont...)
2. GOALS ACHIEVED
VALUES ON DEPOSIT
722.1
1,237.0
1,695.02,130.0
2,583.0
3,342.0
517.7
4,088.4
0
500
1000
1500
2000
2500
3000
3500
4000
4500
1998 1999 2000 2001 2002 2003 2004 Sept.-05
$ Millions US
2.1 Increase of Values on Deposit
2.1 Increase of Values on Deposit
Banco Central de Reserva de El Salvador, Superintendencia Sistema Financiero.
VALORES EN DEPOSITO COMO % DEL PIB Y DEPOSITOS DEL SISTEMA FINANCIERO
4.3% 5.8%
9.4% 12.3%14.9%
17.3%21.1%
12.3%
20.0%
25.7%
32.6%
38.9%
48.6%
9.4%
1998 1999 2000 2001 2002 2003 2004
% RESPECTO AL PIB % RESPECTO DEPOSITOS SF
2.1 Increase of values on deposit balances
DESMATERIALIZED VRS PHYSICAL SECURITIESSeptember 30th, 2005
DOMESTIC VRS INTERNATIONAL SAFEKEEPINGSeptember 30th, 2005
International37%
Domestic 63%
Physical30%
Desmaterialized70%
Finish the transformation process from phsycal securities to Book-Entry.
The creation of Electronic Register Issues and Securities Accounts.
2.2 Dematerialization: 2003-2005
EVOLUTION BY ISSUE TYPE
1,2251,170787
1,0691,145991
518700
2,863
2,1721,796
1,061
550245
22
0
500
1000
1500
2000
2500
3000
3500
1998 1999 2000 2001 2002 2003 2004 Sep-05
PHYSICAL DESMATERIALIZED
$ MILLIONS US
2.3 International Safekeeping agreements
The Bank of New York, USA
State Street, USA
Latin Clear, Panamá
CEVAL, Costa Rica
Clearstream banking, Luxemburgo
Caja de Valores, Guatemala
Bursatec
Pachuca
EL SALVADOR
Internet
Platform Technologic Certification in terms of information and communication security sistems.
Operations and Values Accounts back-up continue and automatically.
2.4 Technological Systems Security and Technical Support
CEDEVAL is the institution trust conferred of register dematerialized values issued by Central Reserve Bank ans the Goverment of El Salvador
2.5 Special Agreements
3. BENEFITS OFFERED BY THE DEPOSITORY
3. Benefits offered by the Depository
FOR THE SECURITIES´ MARKET.
To Contribute directtly to the VALUE MARKET DEVELOPMENT, within reflects the amount and volume of operations traded trough the Stock Exchange.
Furthermore, to contribute trough:
Clearity in the securities managment by higly secure electronic sistems.
To reduce Disminución de distorsiones de precios generados por la demora ocasionada por entrega física de valores
To become more efficent reducing times for clearing and settlement cycles
To reduce the risk of unexecute operations
To facilitate acces to new investors.
FOR THE SECURITIES´ MARKET.
To Contribute directtly to the VALUE MARKET DEVELOPMENT, within reflects the amount and volume of operations traded trough the Stock Exchange.
Furthermore, to contribute trough:
Clearity in the securities managment by higly secure electronic sistems.
To reduce Disminución de distorsiones de precios generados por la demora ocasionada por entrega física de valores
To become more efficent reducing times for clearing and settlement cycles
To reduce the risk of unexecute operations
To facilitate acces to new investors.
3. Benefits offered by the Depository
FOR THE INVESTORS.
SECURITY. Especialized safekeeping, accomplishing with higly securities standars electronics ans operations.
OPORTUNITY. To make the best decisiton with the cuality and promt information on the first hand of investments and value accounts.
ECONOMY. To reduce the costs of safekeeping and administration.
SIMPLIFY THE INVESTMENT ADMINISTRATION, through the execution of cuopon payments.
FOR THE INVESTORS.
SECURITY. Especialized safekeeping, accomplishing with higly securities standars electronics ans operations.
OPORTUNITY. To make the best decisiton with the cuality and promt information on the first hand of investments and value accounts.
ECONOMY. To reduce the costs of safekeeping and administration.
SIMPLIFY THE INVESTMENT ADMINISTRATION, through the execution of cuopon payments.
3. Benefits offered by the Depository
FOR THE STOCKBROKERS.
AGILITY. To Contribute a minimizar el tiempo de las transacciones efectuándose éstas con mayor rapidez y eficiencia.
TO REDUCE THE RISK FOR THE COUNTERPARTY.
HELPS TO IMPROVE THE SERVICE THAT THE BROKERAGE OFFERS TO THEIR CUSTOMERS.
INFORMATION ON LINE. Direct Participants coul acces their values accounts and facilitate their decisitions to invest and register of values.
INTERNATIONALS: DVP Y FVP.
FOR THE STOCKBROKERS.
AGILITY. To Contribute a minimizar el tiempo de las transacciones efectuándose éstas con mayor rapidez y eficiencia.
TO REDUCE THE RISK FOR THE COUNTERPARTY.
HELPS TO IMPROVE THE SERVICE THAT THE BROKERAGE OFFERS TO THEIR CUSTOMERS.
INFORMATION ON LINE. Direct Participants coul acces their values accounts and facilitate their decisitions to invest and register of values.
INTERNATIONALS: DVP Y FVP.
3. Benefits offered by the Depository
FOR THE SECURITIE´S´ ISSUERS COMPANIES.
COSTS MINIMIZATION. Related to the safekeeping and phisic travel (security vaults, insurance contracts and other),
CONTROL OVER THEIR SECURITIES AND HOLDERS.
REDUCING THE RISKS OF LOST, ROBBER AND FALSIFICATION.
MANAGEMENT FACILITIES. Avoiding the signature process, physical securities transfers, etc.
FOR THE SECURITIE´S´ ISSUERS COMPANIES.
COSTS MINIMIZATION. Related to the safekeeping and phisic travel (security vaults, insurance contracts and other),
CONTROL OVER THEIR SECURITIES AND HOLDERS.
REDUCING THE RISKS OF LOST, ROBBER AND FALSIFICATION.
MANAGEMENT FACILITIES. Avoiding the signature process, physical securities transfers, etc.
3. Benefits offered by the Depository
FOR THE GOVERNMENT OF EL SALVADOR AS SECURITIES ISSUER.
Notes and Bills Dematerialized Issues
Setting a issues calendar
Best opportunities to the market
An atractive market for trading
Issuer´s lower costs
FOR THE GOVERNMENT OF EL SALVADOR AS SECURITIES ISSUER.
Notes and Bills Dematerialized Issues
Setting a issues calendar
Best opportunities to the market
An atractive market for trading
Issuer´s lower costs
4. INITIATIVES IN DEVELOPMENT
WEB SITE IMPLEMENTATION
Principal service: ON LINE CONSULT.
To generate trust to the market.
To give access to foreign investors.
To foment the interest and development of the stock market culture.
WEB SITE:
www.cedeval.com
ANNA’S certification to CEDEVAL as a National Numbering Agency.
To facilitate trading and management of local securities in international operations.
To help the recognition of securites as a unique way around the world.
ASSOCIATION OF NATIONAL NUMBERING AGENCIES
ISIN CODE
To increase share’s market trading.
To make a faster shares’ transfer.
To eliminate the risks los riesgos inherentes al manejo físico de acciones.
Give the oportunity to develop the regional share´s market.
SHARES DEMATERIALIZATION
OTROS PROYECTOS
DESMATERIALIZATION OF CERTIFICADOS DE TRASPASO
Efficent manage of certificados de traspaso through the new Pensions Savings System.
The Integration of cash and securities settlement
Developing an infoprmation system to manage the integration of the clearing and settlement cycle of cash and securities to achieve delivery versus payment.
THANK YOUTHANK YOU