Clearstream opens new link to Serbian capital market
- Clearstream adds Serbia as 59th market to its global network
- Access for cross-border investors to Serbian government bonds market aims to increase liquidity in domestic market
- Services include settlement and safekeeping of government bonds
On 4 October 2021, Clearstream, the international central securities depository (ICSD) of Deutsche Börse Group, has connected the Serbian capital market to its global network. Raiffeisen Bank International will act as local custodian and operator of Clearstream’s account at the Serbian central securities depository (CSD).
Clearstream is the first ICSD to offer international investors seamless access to the Serbian capital market by enabling settlement of Serbian government bonds denominated in Serbian Dinar (RSD). This step aims to attract cross-border investments and thereby improve liquidity in the domestic capital market. Clearstream customers will benefit from an omnibus account structure, which increases operational efficiency, and its suite of ICSD services, including offshore (internal) settlement to other Clearstream Banking clients without the need to revisit the domestic market.
The linkage comes following the recent inclusion of Serbia’s dinar-denominated bonds in a series of major local-currency emerging markets indices, such as J.P. Morgan’s Government Bond Index-Emerging Markets (GBI-EM) and their Government Bond Index-Aggregate (GBI-AGG). This step triggered a significant increase in turnover on the secondary market as well as an arrival of new buyers of related bonds and foreign investment funds. The inclusion pays testament to the strengthening of the domestic macroeconomic environment in Serbia and years long efforts to develop the local financial market.
Jan Willems, Head of Global Markets at Clearstream, commented: “We look forward to adding Serbia to our global network, offering our clients access to the domestic capital markets together with excellent local partners. This cross-border link creates various new investment and financing opportunities for the domestic market, underpinning our commitment to connect capital markets all over the world.”
Harald Kreuzmair, Division Head Global Investor Services within Raiffeisen Bank International, said: “We at Raiffeisen Bank International, the bank for Central- and Eastern Europe, are especially pleased that Clearstream has chosen us and Raiffeisen Serbia as their local partner. This comes in light of Serbia already being one of our focus countries and is evidenced by our intent to further grow our Serbian operations. So, we as well, believe in a bright future of the country and the market and together with Clearstream and its clients we will support this development.”
The Republic of Serbia’s Ministry of Finance welcomed Clearstream in opening its new link to the Serbian capital market. It expects this step to create strong links with global depository centres to introduce advanced services for market participants, as well as to facilitate the access for international investors to the Serbian capital market, while strengthening bridges between local issuers and international investors.
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 59 domestic markets worldwide. With 16 trillion Euros in assets under custody, Clearstream is one of the world’s largest settlement and custody firms for domestic and international securities.
About Raiffeisen Bank International
Raiffeisen Bank International (RBI) regards Austria, where it is a leading corporate and investment bank, as well as Central and Eastern Europe (CEE) as its home market. 13 markets of the region are covered by subsidiary banks. Additionally, the RBI Group comprises numerous other financial service providers, for instance in leasing, asset management or M&A. Around 45,000 employees service 17.7 million customers through approx. 1,800 business outlets, the by far largest part thereof in CEE. RBI's shares are listed on the Vienna Stock Exchange. The Austrian regional Raiffeisen banks own around 58.8 per cent of the shares, the remainder is in free float. Within the Austrian Raiffeisen Banking Group, RBI is the central institute of the regional Raiffeisen banks and other affiliated credit institutions.
About the Public Debt Administration, Ministry of Finance, Republic of Serbia
The Public Debt Administration is an administrative authority within the Ministry of Finance of the Republic of Serbia, having the role in the public finance system of ensuring the financing of the budget deficit, current liquidity, investment and program projects of importance for the Republic of Serbia, refinance an outstanding debt and procurement of financial assets, as well as fulfilment of obligations under given guarantees. Under the Public Debt Administration, the primary goal of Serbia's borrowing and public debt management is to ensure the funds necessary to finance budget expenditures regularly, under the most favourable conditions, with medium-term and long-term minimal financial costs and acceptable risk level, as well to uphold the development of the market of government securities issued both in the domestic and international market.