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Straight Through Processing The Success Story in TSD

Straight Through Processing The Success Story in TSD. AGENDA. Force Driving for STP TSD Success Story & Current State STP Processing Flow Future Development Paths. Force Driving of Change. Drivers. Changes. Outcome. Centralized securities depository. OTC Transaction /RTGS. STP.

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Straight Through Processing The Success Story in TSD

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  1. Straight Through ProcessingThe Success Story in TSD

  2. AGENDA • Force Driving for STP • TSD Success Story & Current State • STP Processing Flow • Future Development Paths

  3. Force Driving of Change Drivers Changes Outcome Centralized securities depository OTC Transaction /RTGS STP Present Pre-Settlement Matching Elimination of manual intervention Lack of standard Reduced Operational Costs & Risks Future Corporate Action

  4. TSD Success Story & Current State Clearing of government bonds has been done at the BOT whereas for corporate bonds at the TSD Before Since 15 May 2006, the depository of public debt securities has been migrated from the BOT to TSD Present The centralization of the securities depository and the clearing and settlement system will help improve efficiency and reduce the cost of securities clearing and settlement Benefits

  5. TSD Success Story & Current State (Continued) TSD adopted STP for 1) OTC Transaction for Government Bond 2) RTGS in Bond & Equity Way of Success OTC Transaction (With/Without Payment) Clearing & Settlement from Trading (Gross Settlement)

  6. Value Added Automated End-to-End Integrated Front to Back 1 1 MT 542 (DF) MT 540 (RF) Member A (Transferor) Member B (Transferee) 4 4 MT 544 (RF Confirm ) MT 546 (DF Confirm ) 2 Match DF & RF 3 3 Debit Member A A/C Credit Member B A/C STP for OTC Transaction Transfer Without Payment (Delivery Free)

  7. 1 1 MT 541 (RVP) MT 543 (DVP) 2 Match DVP &RVP Member B (Transferee) Member A (Transferor) 3 Hold Bond MT 547 (DVP Confirm) 7 7 6 MT 545 (RVP Confirm) Debit Member A A/C Credit Member B A/C MT 298/103 (Payment Request) MT 298/107 (Response Message) 4 5 BOT STP for OTC Transaction Transfer With Payment (Delivery Against Payment)

  8. Payment Request Member A Confirm TSD Clearing & Settlement BOT Payment (Cash) Payment Request Exchange Settlement Bank Execution Confirm/Reject Confirm/Reject Confirm Member B Clearing & Settlement from Trading Automated Processing from Trade Inception to Settlement (Gross Settlement)

  9. Benefits for Improving Market Liquidity Minimize Processing Time for Members (Sellers & Buyers) to Increase Trading Turnover Enhance Efficient and Reliable Clearing & Settlement system to increase investors confidence Pave the way for possible regional central securities depository or clearing and settlement linkage in the future.

  10. Future Development Paths • Pre-Matching : SWIFT Message (Q2 2009) Value Proposition Elimination of manual activities Reduce operational risk Shorten Settlement Cycle • Corporate Action: SWIFT Message (Q3 2009) Elimination of manual activities Reduce operational cost Shorten Time Value Proposition

  11. Future Development: Pre- Matching • Pre-Matching : SWIFT Message for Matching instructions between custodian and broker/ custodian and custodian Current Future Investors SWIFT Manual key- In 2 Steps TSD Match TSD SWIFT Manual key- In 2 Steps Investors

  12. Members Members Future Development: Corporate Action Current Future • Members will receive Corporate Action via SWIFT Message SET Issuer TSD SET Issuer TSD SWIFT Download Re-key/SWIFT SWIFT Stakeholders Stakeholders

  13. Thank You www.tsd.co.th

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