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Mexican Settlement Model

Mexican Settlement Model. Gerardo Gamboa. April,2013. Regulators. Financial Participants. Settlement Participants. Ministry of Finance. Banking Commission. Central Bank. Trading Mechanisms. Exchanges. Central Bank. Price Vendors. Facilitators. Infrastructure. History.

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Mexican Settlement Model

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  1. Mexican Settlement Model Gerardo Gamboa April,2013

  2. Regulators Financial Participants Settlement Participants Ministry of Finance Banking Commission Central Bank Trading Mechanisms Exchanges Central Bank Price Vendors Facilitators Infrastructure

  3. History Enhance the Mexican financial markets BIS establishes Payment Systems Principles and Best Practices

  4. Bank for International Settlements DvPModels • Model 1: • Real-time gross settlement • Model 2: • Netting of funds • Model 3: • Netting of securities and funds

  5. Model 1 Real-Time Gross Settlement Borrow Bank A Transaction: 500 securities = $2,000 R9b1k Bank B Bank C 100 $500 USD $500 USD

  6. Model 1 Real-Time Gross Settlement Transaction: 500 securities = $2,000 Liquidity and real-time Efficiency Simplicity

  7. Model 2 Netting of Funds Model 2 Model 1 Transaction: 500 securities = $2,000 Liquidity and real-time Liquidity Efficiency and real-time Simplicity Efficiency Simplicity

  8. Model 3 Netting of Securities and Funds Netted A Bank A B C Transaction: 500 securities = $2,000 R9b1k Abuys 100 X $500 to B At the end of the settlement cycle Asells 100 X $500 to C Bank C Bank B 100 $500 USD

  9. Model 3 Netting of Securities and Funds Model 1 Model 3 Liquidity and real-time Efficiency Liquidity Simplicity and real-time Efficiency Liquidity and real-time Simplicity Efficiency Model 2 Simplicity

  10. DALI Model Model 1 Model 3 Liquidity and real-time Liquidity and real-time Efficiency Model Efficiency Simplicity Simplicity Liquidity and real-time Liquidity and real-time Efficiency Efficiency Model 2 Simplicity Simplicity

  11. MexicanModel Continuous settlement Attain organizational objectives World-class Model 3 system

  12. Settlement System ISO 15022 Indeval Financial Protocol Processes all transactions! Match Engine Securities Management Funds Operations Securities Operations International Operations Settlement Pre-settlement Risk Management Custody Clearing Collateral Management Safekeeping Central Bank Link

  13. Settlement System Settlement Pending To settle To settle To clear Pending Pre-settlement Clearing

  14. Settlement System Settlement 1,200 $83,000 DvP Pre-settlement Clearing

  15. Settlement System Pre- Settlement Settlement Controlled Accounts NamedAccounts Clearing

  16. Features Included Model 1 Model 3 Versatile Flexible Real-Time Efficiency Highly Efficient Hibrid Configurable pre-settlement module Objective functions

  17. Since the First Day of Dalí 270 Clearing and settlement process times each and every business day 67,000 times each year Every settlement cycle being Mission critical

  18. DalíStatistics

  19. Dali Benefits USD 250 billion settled daily 52% reduction USD 130 billion Very conservative intraday opportunity cost USD 240 million in savings in just 18 months

  20. Dali Record In just one minute: USD 75 billion settled 22,000 data base records 10,000 messages sent

  21. Mexican Central Securities Depository Thank you April, 2013

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