Market infrastructure - Sweden

29.03.2017

Institutions and organisation

Stock Exchange - Nasdaq Nordic Exhange

Nasdaq Stockholm AB is the main marketplace for Swedish securities (that is, equities, premium bonds, convertible loans, subscription rights, exchange-traded options/warrants and retail bonds).

Stock exchange activities within the Nasdaq Nordic Exchange are operated under the authorisations to operate a regulated market for the securities exchanges Nasdaq Copenhagen A/S, Nasdaq Stockholm AB, Nasdaq Helsinki Ltd and Nasdaq Iceland hf.

The other authorised regulated market in Sweden1 is the Nordic Growth Market. It provides trading services for small to medium-sized companies.

Exchange trades are cleared, settled and registered (in book-entry form) at the Swedish Central Securities Depository, Euroclear Sweden (formerly Värdepapperscentralen AB (VPC)).

CSD - Euroclear Sweden

Värdepapperscentralen AB (VPC) became Euroclear Sweden in February 2009 and is supervised by the Financial Supervisory Authority of Sweden.

VPC began its operations in 1971. In November 2004, VPC merged with the Finnish CSD APK and while they continue to operate as two separate companies with separate system infrastructures, both CSDs have, since the merger, used the common brand name NCSD (Nordic Central Securities Depository).

At the end of 2006, OMX AB sold their share of VPC and created the owner of VPC, VPC Holding AB.

Four banks (Swebank, Nordea Bank Sverige, Skandinaviska Enskilda Banken, Svenska Handelsbanken) and OMX AB each own 24.82% of VPC Holding AB, with the remaining 0.72% held by investment banks and brokers. VPC Holding AB was renamed NCSD Holding AB at the AGM in 2007.

Since November 2003, VPC (and now Euroclear Sweden) has operated its NewClear settlement system (the “VPC system”), as per BIS Model 1, with settlement completed through a gross exchange of securities and central bank money during a fixed number of settlement batches throughout the day.

Instruments eligible in Euroclear Sweden settle on one of the following two “submarkets”:

  • The Penningmarknad (money market - PM), Sweden’s institutional market for trading in debt securities;
  • The Aktiemarknad (equities market - AM), for trading in equities, equity-related instruments and some corporate bonds.

Each of the submarkets employs slightly different functionality but all securities affiliated to Euroclear Sweden (including, interest-bearing securities) are cleared and settled in the VPC system.

The vast majority of Sweden’s securities are dematerialised and held as book-entry positions in Euroclear Sweden.  A few debt securities exist in physical form outside Euroclear Sweden.

Regulatory structure

The Financial Supervision Authority (FSA) - Finansinspektionen

The exchange and the CSD Euroclear Sweden are supervised by the Swedish FSA that is a government authority under the Ministry of Finance. It was established in 1991 following the merger of the former Bank Supervisory Authority and the Insurance Supervisory Authority. In addition to its function as sole regulator of the Swedish financial and securities markets, FSA is also responsible for regulation of the insurance and credit markets.

Central Bank - Sveriges Riksbank

The Riksbank is the National Central Bank of Sweden and as such is responsible for monetary policy with the objective to maintain price stability. It is also in charge of the promotion of a safe and efficient payment system in Sweden.

1. Aktietorget is no longer an authorised market place and Nya Marknaden is now part of First North, that is, a market place run by Nasdaq Stockholm AB.