MOSCOW EXCHANGE: T+2
Chairman and Chief Executive
Officer, Moscow Exchange
A key strategic priority for the Moscow Exchange is to ensure that price discovery for Russian assets takes place in Moscow. Specific efforts to attract more international and domestic investors include upgrading the market infrastructure, and bringing it in line with international best practices.
“In February, we began the transition to T+2 settlement, one of many initiatives designed to make trading in Moscow easier and bring it in line with investor expectations,” says Alexander Afanasiev, Chief Executive Officer of the Moscow Exchange. “Although the system of pre-funding for trades played an important role as the Russian securities market was just getting off the ground, trading in Russia is now integrated into the global financial system and market participants expect the latest in settlement and risk management tools.
“The transition to T+2 settlement is one of the many initiatives designed to make trading in Moscow easier and bring it in line with investor expectations”
The globally recognised T+ settlement model lowers costs for market participants, increases the efficiency of deployed capital and should lead to higher trading volumes. This system is already in place on our foreign exchange market; now it is time for it to be implemented on the equities market.” Another important priority for the Moscow Exchange is to lobby for the necessary legislative and regulatory reforms that will open up new pools of domestic capital for investment in the equity markets. Russia has the savings to support a deep local investor base.
Total pension system assets today stand at $90bn, of which only 2.2% is in equities. Individuals also have significant personal savings, but savings tend to be kept in bank deposits, real estate or even cash. Enormous potential exists for growth in the local securities industry through the rebalancing of asset allocations.
- Ensuring that price discovery for Russian asset stakes place in Moscow is a key strategic priority.
- Transition to T+2 settlement began in February2013.
- The system is already in place on the foreign exchange market.
- Implementation on the equities market will follow.
- Potential exists for growth in the local securities industry through the rebalancing of asset allocations.