DEX version 11.1 saw the introduction of new message versions and the enhancement of Money Market Instruments and REPO transactions. To comply with our policy of implementing changes ahead of CREST trialing, both these new areas of functionality were made available on the 30th of June 2003.
MONEY MARKET INSTRUMENTS
Money Market Instruments [MMIs] are predominantly used by the Government, the banking sector and industry to raise short term funding or for undertaking short term investments. MMIs are used as collateral for secured stock or cash lending.
Issued through Treasury Bills, Certificates of Deposit, Bill of exchange and Commercial Paper, the MMI is a principally sterling based mechanism traded on the same day [T + 0] on an over the counter [OTC] basis.
In order for them to be settleable in Crest, MMIs
will be changed to Eligible Debt Securites [EDS] which will be in the form
of registered, fungible securities.
New Participants
Issuing and Paying Agents [IPA] will be new participants able to create, make interim interest payments and pay maturity proceeds in Crest.
REPO TRANSACTIONS
A Repo transaction is any transaction in which two parties agree that one will sell equity securities to the other and [at the same time, as part of the terms of the original transaction] commit to repurchase equivalent securities on a specified future date or at call, at a specified price.
3 new transactions will be created as a result of this enhancement to Repo transactions;
• Repo transaction [RPO] -
the outward leg of the transaction which will be inputted with an ARPN instruction.
Members will be able to delete [using the ATXD funtionality] and amend a
Repo [using the ATXA functionality] transaction, but splitting will not
be permitted.
• Repo Return transaction [RPR] - these are the return legs of the transaction which is created upon settlement
of the RPO.
RPRs will be identifiable from the transaction ID of the original Repo transaction
and will be incremented on each of the returns. For example, a Repo transaction
with 2 stock movements with a transaction ID of 123456 will have 2 RPRs
with IDs 12345601 and 12345602.
• Substituting stock with a Repo[SUB] - Members are able to replace stock that has been sold as part of a Repo
transaction with other securities of equivalent value.
SUBs will be performed with the transaction type [ASBN] which will transfer
the required amounts of stock in and /or out of the Repo and create/delete
Repo return transactions as required.
Please email the Support Desk if you have any questions on testing the above functionalities.
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