How to Organize Central Securities Depositories in Developing Markets: Key Considerations

Author: Ms. Froukelien Wendt, Peter Katz, and Alice Zanza

This note aims to support authorities in their decision making about the optimal organization of central securities depositories (CSDs) in their country.

Volume/Issue: Volume 2019 Issue 001

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Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Finance , Investments and Securities-General , FADHTN , HTN , financial market , private sector , single CSD , CSD operation , debt management , cash settlement , CSD operator , ownership structure , fixed cost , BNR authorities , Philippines government , authorization of the CSD , authorities in the Kyrgyz Republic , CSD technology , Central securities depositories , Securities , Government securities , Securities markets , Stock markets , Global , Europe , government securities market , Organize Central Securities depository , ConsiderationsHow-To note , develop market , key ConsiderationsHow-To note , key consideration , Asia and Pacific

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Summary

The key objective of this note is to support authorities in their decision making about the optimal organization of central securities depositories (CSDs) in their country. For the purpose of this note, a CSD is defined as an entity that provides securities accounts, a securities settlement system, and central safekeeping services to market participants, which can be banks and other financial institutions. Authorities in developing markets, in particular central banks, may grapple with two questions: (1) whether to pursue a single CSD to increase market efficiencies and benefit from economies of scale and scope and (2) whether to partake in the governance of the CSD as owner or operator. This note presents seven considerations for authorities to take into account when answering these questions and determining the best model for their country.