Georgian corporate bonds now eligible in Clearstream

10.09.2018

Clearstream Banking S.A. is the sole international central securities depository (ICSD) to offer access to the two local settlement platforms in Georgia, that is, the National Bank of Georgia and the Georgian Central Securities Depository. These accesses are granted through an indirect link with Bank of Georgia JSC as sub-custodian and cash correspondent. By offering new services in the Georgian capital markets, Clearstream further enhances the access to the Caucasian capital markets for international investors.

Effective settlement date 10 September 2018, Clearstream Banking S.A. will offer settlement, custody and asset servicing for selected Georgian corporate bonds. This is in addition to the securities issued by the Government of Georgia and international financial institutions (IFIs).

Philip Brown, Co-CEO of Clearstream Banking S.A., commented: “We are delighted to extend our service offering in Georgia to settlement and custody service for corporate bonds, together with the National Bank of Georgia and the Georgian Stock Exchange. Through Clearstream’s broad network international investors can benefit from a wide range of services when accessing the domestic financial market in Georgia.”

Archil Mestvirishvili, vice-president of the National Bank of Georgia, commented: “Expanding the link will increase interest in the Georgian bond market. Additionally, we have recently undertaken a set of reforms to remove all tax-related risks, for example, non-residents are now exempt from capital gains tax and withholding tax on coupons and dividends. By November, we will ensure delivery-versus-payment settlement for all corporate bonds and equities in Central Bank money.”

George Paresishvili, Chief Executive Officer of the Georgian Stock Exchange, commented: “Making Georgian corporate bonds eligible in Clearstream is a very significant development for the Georgian capital market and marks another milestone on the road towards making the Georgian market accessible to a much wider universe of foreign investors. With an already strong pipeline of new publicly listed corporate bond issues, we expect their number to grow even further following their inclusion in the Clearstream link.”

Kaha Kiknavelidze, CEO of Bank of Georgia, commented: “We are pleased that Clearstream, one of the largest providers of post-trading services in the world, made Georgian corporate bonds eligible in its system. The ICSD link will greatly facilitate the administration procedures for investors interested in Georgian corporate fixed-income instruments, will save their time and make settlement processes substantially more efficient.”