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BESP settlement system

BESP settlement system. Recent developments and progress report. 3 IRSF, London, April 16, 2008. General characteristic of BESP. Voluntary participation; Gradual introduction; Real Time Gross Settlement system;

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BESP settlement system

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  1. BESP settlement system Recent developments and progress report 3 IRSF, London, April 16, 2008 V. Kulipanov 3 IRSF, London April 16, 2008

  2. General characteristic of BESP • Voluntary participation; • Gradual introduction; • Real Time Gross Settlement system; • Some liquidity saving features, generally attributed to Net Settlement systems; • Centralization at the federal level. V. Kulipanov 3 IRSF, London April 16, 2008

  3. Information on the Web The relevant information about BESP settlement system, applicable regulations and statistics will be available in the “English” part of Internet site www.cbr.ru in mid May 2008. V. Kulipanov 3 IRSF, London April 16, 2008

  4. Options of membership • Special participation • Direct participation • Associated participation V. Kulipanov 3 IRSF, London April 16, 2008

  5. Options of membership • Special participation • Direct participation • Associated participation CBR Head Office CBR Branches BESP system V. Kulipanov 3 IRSF, London April 16, 2008

  6. Options of membership • Special participation • Direct participation • Associated participation CBR Head Office Bank DSP CBR Branches BESP system V. Kulipanov 3 IRSF, London April 16, 2008

  7. Options of membership • Special participation • Direct participation • Associated participation CBR Head Office Non-bank ASP Bank DSP CBR Branches BESP system Bank ASP V. Kulipanov 3 IRSF, London April 16, 2008

  8. Transport BESP V – scheme SWIFT formats UFEBM Conversion CBR Transport system SWIFT transport UFEBM DSP SSP DSP ASP V. Kulipanov 3 IRSF, London April 16, 2008

  9. Functions of Central Bank in BESP Regulator and oversight authority Operator User V. Kulipanov 3 IRSF, London April 16, 2008

  10. Time scheduleUntil BESP was implemented Up to 2 days Interregional Settlement System V. Kulipanov 3 IRSF, London April 16, 2008

  11. Time scheduleAfter implementation of BESP • System runs in Real time • Unified Schedule for all time zones Core of BESP system V. Kulipanov 3 IRSF, London April 16, 2008

  12. Three phases of BESP business day Preliminary phase Final phase Regular phase 21-00 21-30 08-00 09-00 V. Kulipanov 3 IRSF, London April 16, 2008

  13. Preliminary phase • Updating regulatory and reference information; • Registration /exclusion/ temporary suspension of BESP participants; • Initial liquidity setting in BESPby DSP • Setting (multilateral, bilateral, etc) limits to benefit from liquidity saving mechanism V. Kulipanov 3 IRSF, London April 16, 2008

  14. Regular phase • Payment acceptance and processing; • Queue maintenance and management; • Information exchange with BESP participants; • Liquidity management by DSP; • Temporary suspension/release of DSP participation by CBR. V. Kulipanov 3 IRSF, London April 16, 2008

  15. Final phase • Dailycompletion of BESP settlement; • Generation and transmission of statements and reports to BESP participants; • Generation and transmission of output report to the General Ledger; • Informationarchiving. V. Kulipanov 3 IRSF, London April 16, 2008

  16. Views on DSP liquidity Acc+Ovdrft Total liquidity BESP+LocalPS Available line of overdraft credit Liquidity for BESP Entire liquidity of DSP Account balance Liquidity for Local PS V. Kulipanov 3 IRSF, London April 16, 2008

  17. Liquidity bridgebetween BESP and Local payment system Liquidity in BESP Liquidity in Local PS V. Kulipanov 3 IRSF, London April 16, 2008

  18. Liquidity bridgebetween BESP and Local payment system Liquidity in BESP Liquidity in Local PS V. Kulipanov 3 IRSF, London April 16, 2008

  19. Single transaction Business process • Technical checks. • Logical checks. • Liquidity sufficiency check (Queue). • Payment settled. Finality and irrevocability. • Synchronization request from BESP system to accounting systems. • Debit/Credit confirmation. V. Kulipanov 3 IRSF, London April 16, 2008

  20. Queuing in BESP This payment will be processed only after all time-critical payments are settled This payment will be processed last Ordinary payments This payment will be settled before any ordinary payment is processed Time-critical payments This payment will be processed first V. Kulipanov 3 IRSF, London April 16, 2008

  21. Queuing in BESP Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  22. Queuing in BESP Set-off Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  23. Queuing in BESP Set-off Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  24. Queuing in BESP Set-off Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  25. Queuing in BESP Set-off Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  26. Queuing in BESP Set-off Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  27. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  28. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  29. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  30. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  31. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  32. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  33. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  34. Queuing in BESP Optimization Ordinary payments Time-critical payments V. Kulipanov 3 IRSF, London April 16, 2008

  35. Queuing in BESP At the end of day all payments in queues are automatically cancelled ! V. Kulipanov 3 IRSF, London April 16, 2008

  36. Information services for DSP On request Without request • Results of processing of the recently input document; • Debit/Credit confirmation based on the recently input document • Final daily statement • Correspondent account balance; • BESP Liquidity statement; • Total overnight line of credit, and it’s available value; • Aggregated value of incoming payment orders in the queues of other DSP Banks • Liquidity statement for affiliates • Intraday statement • … and some other minor issues… V. Kulipanov 3 IRSF, London April 16, 2008

  37. New business opportunitiesthat were enabled by BESP • Extension and unification of business day schedule throughout entire territory of the country, which result in acceleration of payments, stop discrimination of banks on “the geographical” basis; • Concentration of liquidity flows over nostro accounts of Direct participants, who may now provide their fast payment services to non-member banks. V. Kulipanov 3 IRSF, London April 16, 2008

  38. Joining BESP membership • How to apply. Where to apply. • Requirements to be met by applicant. • Terms of expected reply. • Necessity of pilot run. • Self-evaluation act for security recommendations of CBR. • Terminal of DSP. Functionality and integration. • Available STP features. V. Kulipanov 3 IRSF, London April 16, 2008

  39. 25 RUR per ordinary payment 30 RUR per time-critical payment BESP tariffs Applicable to Direct Settlement Participants Applicable to Associated Settlement Participants • 20 RUR per payment V. Kulipanov 3 IRSF, London April 16, 2008

  40. Pattern of Contracts Amendments to Banking Account Contract Amendments to Technical interfaces Contract Bank DSP V. Kulipanov 3 IRSF, London April 16, 2008

  41. Launch Date of BESP • July 1, 2007. All regulated documents were adopted and became effective by that date. Technical preparations were finished. The first participants were in. The system started, however there were no payments until… • December 21, 2007 The first few payments came through. V. Kulipanov 3 IRSF, London April 16, 2008

  42. BESP in figuresQuantity of Direct, Associated and Special participants. V. Kulipanov 3 IRSF, London April 16, 2008

  43. BESP in figuresVolume and total Value of payments. V. Kulipanov 3 IRSF, London April 16, 2008

  44. V. Kulipanov 3 IRSF, London April 16, 2008

  45. BESP in figuresComparison of active participants to their total quantity V. Kulipanov 3 IRSF, London April 16, 2008

  46. BESP in figures • The average daily value of liquidity in the system was 92mln. RUR • The average processing time of single transaction is 30 seconds. V. Kulipanov 3 IRSF, London April 16, 2008

  47. BESP Pilot Run • BESP Pilot Run continues even after the system itself was successfully launched on Dec 21, 2007. The reason is to provide testing facilities to new prospective BESP participants. • BESP Pilot Run provides entire collection of BESP services, that are available in the real system. • BESP Pilot Run is performed in the real-time manner, where the prospective participants experience liquidity control mechanisms,Limits control mechanisms, Queuing control mechanisms, and, of cause, try sending and revoking their payment instructions. V. Kulipanov 3 IRSF, London April 16, 2008

  48. BESP Pilot Run By the date April 11, 2008 BESP Pilot Run was covering 55 regions of Russian federation, located in 11time zones.The overall amount of registered participants totals to698, including: V. Kulipanov 3 IRSF, London April 16, 2008

  49. The future possible participants • MICEX Settlement House andNational Clearing Centre to join BESP; • Anticipating for SBERBANK to come during 2008; • Estimates for Critical quantity of members to join BESP. V. Kulipanov 3 IRSF, London April 16, 2008

  50. Already BESP members • Petrocommerce • Raiffeisenbank • Uralsib Pilot run completed • Gasprombank The future possible participants from top 30 • Citibank • Zenit • Transcreditbank • Russian Standard • Promsvyazbank • Micex Settlement House CBR consent received V. Kulipanov 3 IRSF, London April 16, 2008

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