National Settlement Depository (NSD), Russia’s central securities depository, has completed the annual assessment of its compliance with the CPMI-IOSCO Principles for Financial Market Infrastructures (PFMIs).
Compared with the previous year’s assessment, improvements were reported in NSD’s observance of three principles (“Money Settlements,” “Custody and Investment Risk” and “Tiered Participation Arrangements”). The level of observance of the remaining principles remained unchanged. FMIs are expected to undertake regular self-assessments in order to establish their degree of observance of the PFMIs, using the Assessment Methodology and Disclosure Framework associated to the PFMIs.
The results of the analysis show that NSD is “broadly” observant of the PFMIs. Of the 24 principles, NSD “fully” observes 14, “broadly” observes 6, and there are 4 principles not applicable to NSD’s operations. There are no principles that NSD does not observe.
In accordance with the recommendations made by the Committee on Payment and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO), as well as by the Bank of Russia, NSD regularly assesses the level of compliance of its operations with the requirements and recommendations set out in the PFMIs, and discloses the results on its website.
In 2016, the Bank for International Settlements (BIS) assigned the highest rating to the Russian financial market infrastructure according to the results of the monitoring of the formation of legislative framework for developed and emerging financial markets. Russia’s FMI received the 4th level rating (highest possible) alongside with FMIs of Germany, France, Great Britain, Hong Kong, Singapore, etc.
The BIS monitoring includes a thorough analysis of the legislative framework for the Russian CSD’s, repositories’, and central counterparties’ operations, allowing the national market to observe the CPMI-IOSCO Principles for Financial Market Infrastructures.