NDU to become central depository, AUSD to remain payment and clearing depository, says SCSSM head
Kyiv, April 1 (Interfax-Ukraine) – The organization committee for the creation of the central depository of securities and introduction of the clearing system on the stock market approved by the Ukrainian premier has proposed to divide the depositories into a depository for the registration system and a payment and clearing depository.
"Registration should be free from money risks. The National Depository of Ukraine (NDU) is more prepared for the realization of the registration function and the All-Ukrainian Securities Depository (AUSD) for the payment and clearing activities," Head of the State Commission for Securities and the Stock Market, Dmytro Tevelev, said at a press conference at Interfax-Ukraine on Thursday.
Tevelev said that the organization committee proposed to create a central depository on the basis of the NDU and empower it with exclusive powers to service issuers of securities in book-entry form. A requirement on the obligatory depositing of all global certificates on the issues at the NDU is to be approved.
In addition, the NDU would keep the register of government securities, which at present is kept by the depository of the National Bank of Ukraine (NBU).
Tevelev added that it is expected to reduce the state-owned share in the NDU from the present 86% to a 50% plus one share stake, giving market players, first of all shareholders in the AUSD, the chance to take part in the additional issue of shares, but with restricted size of stake that could be acquired. He said that there is a hypothetical chance for a top international depository like Euroclear to contribute to the NDU's capital.
Ihor Prasolov, the head of the subcommittee of the parliamentary committee for finances and banking activity, added that the organization committee proposed to deprive the NDU of the right to carry out payment and clearing activities.
He said that the organization committee is to meet soon and will finally approve a draft law on the centralization of the depository system. The lawmaker said that wider draft laws with amendments to the law on the national depository system and specifics of securities circulation in Ukraine would be drawn up by June. The new laws would improve regulation of the clearing and payments system and toughen requirements on depositors.
Prasolov said that the second draft law could include a requirement on the functioning of a central counteragent for all exchanges, and the AUSD could become this counteragent.
He also said that the organization committee is not considering the idea of merging the AUSD and the NDU. He added that the transitive clauses of the draft law on the centralization of the depository system would introduce a moratorium on the creation of new depositories in Ukraine.
Tevelev said that he does not see a risk in increasing AUSD tariffs for payment and clearing services due to the transfer of all issuers to the NDU. He said that payment and clearing activities should bring enough income to the AUSD to retain tariffs acceptable for the market.
Currently there are three operating depositories in Ukraine: the commercial All-Ukrainian Securities Depository (AUSD) with an NBU share of 22.86%, and an 8.44% share owned by state-run banks, the National Depository of Ukraine (NDU) with an 86% state-owned stake, and the depository of government securities of the NBU.
The Ukrainian cabinet in late February approved an organization committee for the creation of a central depository on the basis of the NDU and the depository of government securities of the NBU.