Clearstream to link Romanian equities to its network on 1 July 2020
- Romanian equities to become eligible via Clearstream’s network
- Government and municipal bonds eligible in Clearstream since 2010, corporate bonds since May 2020
- Easier access to Romanian capital market for international investors; Romanian markets to benefit from funding opportunities
- High demand expected due to Romania receiving status of Emerging Market by the global index provider FTSE Russell in September 2020
A new domestic link will enable settlement and safekeeping of Romanian equities through Clearstream’s international infrastructure, providing easier access to Romanian capital markets for international investors and in turn new funding opportunities for Romanian markets.
On 1 July 2020, Clearstream, Deutsche Börse Group’s international central securities depository (ICSD), will connect local Romanian equities to its international network. BRD Group Société Générale will act as local depository partner for Clearstream, connecting in turn to the Romanian central securities depository (CSD) Depozitarul Central.
This step will enable settlement and safekeeping of all equities denominated in Romanian Leu (RON) through Clearstream’s international infrastructure, improving efficiency with international standards while reducing costs for investors.
Jan Willems, Head of Global Markets at Clearstream, commented: “Being able to enter emerging markets via an internationally established post-trade environment is very attractive to investors all over the world. Romania has been already a long-time part of our global network. Clearstream now making Romanian local equities available to international investors will add to the market’s attractiveness, increasing demand and thus liquidity of Romanian equities. The local market will benefit from a wider range of sources of funding, contributing to its further development.”
Silvia Buicanescu, CEO at Depozitarul Central, commented: “We are very pleased that Clearstream is expanding its services for the Romanian capital market. This has been a requirement that we have heard more and more often in recent years from foreign investors but also from Romanian issuers, especially after the inclusion of Romania on the watch-list for promotion to the secondary emerging market status by one of the leading global index providers, FTSE Russell. The reclassification of the Romanian capital market status, entering into force in September 2020, will be an achievement very long-awaited by investors, intermediaries and all stakeholders, and also the most important acknowledgment of our efforts to develop the Romanian capital market.”
Claudiu Cercel, Deputy CEO at BRD Groupe Société Générale in charge of Financial Markets: “We are honoured to support Clearstream in the local equities market via our comprehensive securities services platform. The increase in investors’ interest this partnership is about to bring, coupled with new listings on Bucharest Stock Exchange and the upcoming market status upgrade, will be conducive to a healthy and sustainable growth of Romanian capital markets and, as a consequence, to the consolidation of alternative financing channels for the Romanian economy.”
Clearstream has been present in the Romanian market offering government and municipal bonds since 2010. In May 2020, it added local corporate bonds to its ICSD infrastructure and is now completing its portfolio with local equities. As the only ICSD offering the entire range of Romanian instruments, Clearstream is demonstrating its commitment to one of the fastest-growing Central and Eastern European (CEE) capital markets.
As an international central securities depository (ICSD), headquartered in Luxembourg, Clearstream, which is part of Deutsche Börse Group, provides the post-trade infrastructure for the Eurobond market and services for securities from 58 domestic markets worldwide. With around 14 trillion Euros in assets under custody, Clearstream is one of the world’s largest settlement and custody firms for domestic and international securities.
About Depozitarul Central
Depozitarul Central is the institution that ensures the financial market infrastructure in Romania, having the role of the operator for the securities settlement system RoClear and fulfilling the registry function for the joint stock companies.
In addition to these important services, Depozitarul Central provides a wide range of other related and ancillary services to the participants, issuers, investors and financial instruments holders, and is constantly preoccupied to harmonise all its services and activities with the European best practices, at high standards, with low risk and low costs.
Depozitarul Central is committed in increasing the reliability, efficiency and robustness of its systems, applications and mechanisms involved in providing post-trading and registry services.
About BRD Groupe Société Générale
BRD Groupe Société Générale is the third largest Romanian bank in terms of assets. BRD operates a network of 640 branches and has a leading position on the card market, with approx. 2.43 million cards and a network acceptance of approx. 30,000 POS and almost 1,500 ATMs. The bank is a major player on the corporate credit market to local and multinational companies and the leader of the Romanian factoring market. Its total assets, end of Q1, 2020, amounted to RON 57.02 Bn.
BRD is part of Société Générale Group, one of the largest European financial services groups. The group has 138,000 employees in 62 countries and 29 million customers worldwide in its three key activities:
- French retail banking
- International Retail Banking, Insurance and Financial Services to Corporates
- Global banking and investor solutions.