Settlement services - Croatia

27.07.2018

Pre-matching service

Erste & Steiermärkische Bank contacts the counterparty's custodian by telephone or email and checks the details of all the transactions before matching them in the system.

Procedures for domestic counterparties

Procedure for the domestic counterpartyDeadline
Domestic counterparties delivering/receiving securities free of payment in favour of/from a CBL customer must indicate in their instructions:Market deadline
-Receive from/Deliver to: Erste & Steiermärkische Bank d.d. Zagreb (SWIFT: ESBCHR22), in favour of account CS2013/020/9665749 Erste Group Bank AG Vienna (SWIFT: GIBAATWG).
-In favour of: name and account number of CBL customer.

Specific settlement rules / settlement restrictions

Connectivity mediumInstruction format
CreationOnline and Xact Web PortalTick to enable the "Immediate Release" option
Xact via SWIFT and Xact File TransferField :22F::STCO/CEDE/IREL

Settlement with Bridge counterparties is not possible; only internal and domestic instructions are allowed.

It is mandatory for customers to pre-advise free of payment receipts of Croatian securities using a free of payment instruction. CBL’s depository Erste Bank will refuse all such free of payment receipts that have not been pre-advised by the customer.

If settlement is requested to take place on an Austrian holiday, the settlement instruction must be sent to CBL one business day before the banking holiday in Austria. Settlement confirmations received on a banking holiday in Austria are received in CBL on SD+1.

According to a Croatian Central Bank Resolution, Croatian Banking shares must be held at the Croatian CSD in a custody account in the name of the beneficial owner.

CBL does not offer the safekeeping of Croatian Banking shares.

Management of failed instructions

Instructions for a failed transaction will retain their failed status until the counterparty fulfils the requirements of the transaction.

Although, in accordance with standard procedures, unsettled receipt instructions are automatically cancelled 60 calendar days after the requested settlement date, CBL reserves the right to cancel such instructions if they have not settled by the fifth domestic business day after the requested settlement date and have not been reconfirmed by the customer.

Penalties (buy-ins etc.)

Failing to meet cash obligations to the CDCC (SELL OUT)

If the member fails to meet  its cash obligations to the CDCC before the system checking of unsettled cash obligations on the intended settlement date (11:00 CET on SD), the member will have a debt in the CDCC and a penalty fee will be calculated.

If the member has a debt at the moment of initiating second batch of contractual settlement daily cycle on the intended settlement date (12:30 CET on SD), the CDCC will initiate sell-out procedure.

If the member meets its cash obligation on the intended settlement date before initiating the third batch of contractual settlement daily cycle (14:30 CET on SD), the CDCC will cancel the sell-out procedure on the same day.

If the member fails to meet its cash obligation by the beginning of the first batch of contractual settlement daily cycle on the day following the intended settlement date (08:30 CET on S+1), the CDCC shall suspend the member and carry out securities sell-out. The CDCC shall be entitled to charge compensation and incurred costs for securities sell-out related to covering debt on the contractual settlement cash clearing account.

Failing to meet the obligation to deliver securities to the CDCC (BUY IN)

If the member fails to deliver securities  by  the beginning of first batch of contractual settlement daily cycle  on the intended settlement date (08:30 CET on SD),  the CDCC will initiate buy-in procedure. Every day the CDCC will automatically charge penalty fee.

If the member fails to deliver securities before the initiation of the first batch of contractual settlement daily cycle on the third working day following the intended settlement date (08:30 CET on S+3), the CDCC will suspend the member and buy-in the securities.

Penalties applied in case of failed transaction and charged to members failing to meet their obligations:

Settlement

Failure

Penalty fee

Basis for calculation

Contractual Settlement

To deliver securities on SD

0,50% (VAT exempt)

Amount in cash

Fee is calculated daily, based on the value of the collateral for undelivered securities which is transferred to member's cash clearing account for buy-in. 

To deliver funds on SD

1,00% (VAT exempt)

Amount in cash

Fee is calculated daily, based on the amount of money obligation in contractual settlement, not fulfilled in accordance with the CDCC Procedures.

Trade-for-trade Settlement

Delay in settlement caused by failing to meet obligations

120,00 HRK+VAT

Transaction

Fee is calculated daily for all transactions for which the settlement date has set in and the obligations have not been completely fulfilled, whether it is a case of money payments or securing necessary amount of securities. Fee is calculated at the end of the day on which transactions were supposed to be settled.