NFEA Russian Rates Derivatives 2012. Infrastructure: Trading, Settlement & Repository

Danny Corrigan, Managing Director, Ruble, ICAP

13 March 2012

Date 2000-01 2006-07 2008-09 2010-11

Event New Government Intl trading of Gazprom shares

FX Controls lifted

Derivatives ‘not gaming’

RUB bank accounts opened

Automated trading, DMA

Russian ISDA developed

SWIFT open office in Moscow

Merger or MICEX-RTS

Many more RUB accounts opened

RUONIA fixing

Feb ‘On Clearing & Clearing Activities’ & ‘ Amending Law’

CLS ‘Kick off’ meeting

Currency USD USD, RUB USD, RUB USD, RUB

Products Eurobonds Domestic Equities

ADRs & GDRs

Eurobonds

Domestic equities

ADRs & GDRs

Spot FX (small)

NDFs (off shore, EMTA fix)

Eurobonds

Domestic equities

ADRs & GDRs

Spot FX

Forward FX

Swaps (CCS, IRS, Basis)

Eurobonds

Domestic equities

ADRs & GDRs (10years of LSE IOB)

Spot FX

Forward FX

Swaps (CCS, IRS, Basis)

OIS

Settlement Euroclear

DTC

Domestic

Euroclear

DTC

Domestic

Euroclear

DTC

Domestic

Derivatives: USD settled

Euroclear

DTC

Domestic

Derivatives: USD & RUB settled

Local Presence Few active.

Deal from London

More active

Deal from London & H.Q

Resident international banks re-capitalised.

Deal London, H.Q., Moscow

Deal Moscow, London, H.Q

Russian Financial Markets – Recent History

Russian Financial Markets -Future Developments

Date 2012 2013 2014 -

Event New Government

Central Depository Act &

Federal Exchange & On Organised Trading Act

Enacted

Merger of MICEX-RTS, Single CSD

Russian Trade Depository established (June)

Close-out netting under master agreements, legal opinions

Further adoption of CCP offerings

Continuing adoption of SWIFT messaging & protocols

Simplification of securities issuance procedure

Securitization of financial assets, improvement of mortgage securities legislation

Shareholder rights in M&A

Disclosure of beneficial equity owners

Bond holder rights protected

Expand pension products

Tax incentives for investments

Ruble CLS currency

RDRs

Settlement Access by Euroclear & Clearstream to settlement of bonds & equities at NSD

Nominee accounts to be opened

SEC Reg 17f-7 (Custody with foreign securities depository)

DR restrictions modified

Development Further development of Exchange, Clearing & Settlement infrastructure and at membership level

Membership WTO

IOSCO

RTGS adopted via BESP

CLS

Contact details

Danny Corrigan, ICAP Europe

E-mail: danny.corrigan@icap.com

Tel: +44 207 532 4835

Mob: +44 7587 88 51 10